ý
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QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
o
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TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
|
For the transition period from
|
|
to
|
OHIO
|
|
31-1414921
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(State or other jurisdiction of
incorporation or organization)
|
|
(I.R.S. Employer
Identification No.)
|
|
|
|
14111 SCOTTSLAWN ROAD,
MARYSVILLE, OHIO
|
|
43041
|
(Address of principal executive offices)
|
|
(Zip Code)
|
Large accelerated filer
|
|
ý
|
|
Accelerated filer
|
|
o
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Non-accelerated filer
|
|
o
(Do not check if a smaller reporting company)
|
|
Smaller reporting company
|
|
o
|
|
Class
|
|
Outstanding at May 6, 2016
|
|
|
Common Shares, $0.01 stated value, no par value
|
|
61,226,154 Common Shares
|
|
THE SCOTTS MIRACLE-GRO COMPANY
INDEX
|
||
|
|
|
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PAGE NO.
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||
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|
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||
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||
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THREE MONTHS ENDED
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|
SIX MONTHS ENDED
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||||||||||||
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APRIL 2,
2016 |
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MARCH 28,
2015 |
|
APRIL 2,
2016 |
|
MARCH 28,
2015 |
||||||||
Net sales
|
$
|
1,245.2
|
|
|
$
|
1,071.8
|
|
|
$
|
1,439.7
|
|
|
$
|
1,241.3
|
|
Cost of sales
|
723.5
|
|
|
646.8
|
|
|
896.3
|
|
|
809.7
|
|
||||
Cost of sales—impairment, restructuring and other
|
0.1
|
|
|
0.2
|
|
|
5.1
|
|
|
0.2
|
|
||||
Gross profit
|
521.6
|
|
|
424.8
|
|
|
538.3
|
|
|
431.4
|
|
||||
Operating expenses:
|
|
|
|
|
|
|
|
||||||||
Selling, general and administrative
|
200.9
|
|
|
188.9
|
|
|
314.2
|
|
|
294.2
|
|
||||
Impairment, restructuring and other
|
(47.2
|
)
|
|
4.6
|
|
|
(45.9
|
)
|
|
13.1
|
|
||||
Other income, net
|
(1.3
|
)
|
|
(0.3
|
)
|
|
(1.5
|
)
|
|
(0.6
|
)
|
||||
Income from operations
|
369.2
|
|
|
231.6
|
|
|
271.5
|
|
|
124.7
|
|
||||
Costs related to refinancing
|
—
|
|
|
—
|
|
|
8.8
|
|
|
—
|
|
||||
Interest expense
|
19.1
|
|
|
15.0
|
|
|
35.4
|
|
|
24.7
|
|
||||
Income from continuing operations before income taxes
|
350.1
|
|
|
216.6
|
|
|
227.3
|
|
|
100.0
|
|
||||
Income tax expense from continuing operations
|
124.3
|
|
|
78.0
|
|
|
80.7
|
|
|
36.0
|
|
||||
Income from continuing operations
|
225.8
|
|
|
138.6
|
|
|
146.6
|
|
|
64.0
|
|
||||
Loss from discontinued operations, net of tax
|
(16.0
|
)
|
|
(14.3
|
)
|
|
(17.5
|
)
|
|
(13.7
|
)
|
||||
Net income
|
$
|
209.8
|
|
|
$
|
124.3
|
|
|
$
|
129.1
|
|
|
$
|
50.3
|
|
Net loss (income) attributable to noncontrolling interest
|
0.3
|
|
|
0.3
|
|
|
(0.1
|
)
|
|
(0.3
|
)
|
||||
Net income attributable to controlling interest
|
$
|
210.1
|
|
|
$
|
124.6
|
|
|
$
|
129.0
|
|
|
$
|
50.0
|
|
|
|
|
|
|
|
|
|
||||||||
Basic income per common share:
|
|
|
|
|
|
|
|
||||||||
Income from continuing operations
|
$
|
3.68
|
|
|
$
|
2.28
|
|
|
$
|
2.39
|
|
|
$
|
1.05
|
|
Loss from discontinued operations
|
(0.26
|
)
|
|
(0.23
|
)
|
|
(0.29
|
)
|
|
(0.23
|
)
|
||||
Basic income per common share
|
$
|
3.42
|
|
|
$
|
2.05
|
|
|
$
|
2.10
|
|
|
$
|
0.82
|
|
Weighted-average common shares outstanding during the period
|
61.4
|
|
|
60.9
|
|
|
61.4
|
|
|
60.9
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Diluted income per common share:
|
|
|
|
|
|
|
|
||||||||
Income from continuing operations
|
$
|
3.64
|
|
|
$
|
2.24
|
|
|
$
|
2.35
|
|
|
$
|
1.03
|
|
Loss from discontinued operations
|
(0.26
|
)
|
|
(0.23
|
)
|
|
(0.28
|
)
|
|
(0.22
|
)
|
||||
Diluted income per common share
|
$
|
3.38
|
|
|
$
|
2.01
|
|
|
$
|
2.07
|
|
|
$
|
0.81
|
|
Weighted-average common shares outstanding during the period plus dilutive potential common shares
|
62.2
|
|
|
62.1
|
|
|
62.4
|
|
|
62.0
|
|
||||
|
|
|
|
|
|
|
|
||||||||
Dividends declared per common share
|
$
|
0.470
|
|
|
$
|
0.450
|
|
|
$
|
0.940
|
|
|
$
|
0.900
|
|
|
THREE MONTHS ENDED
|
|
SIX MONTHS ENDED
|
||||||||||||
|
APRIL 2,
2016 |
|
MARCH 28,
2015 |
|
APRIL 2,
2016 |
|
MARCH 28,
2015 |
||||||||
Net income
|
$
|
209.8
|
|
|
$
|
124.3
|
|
|
$
|
129.1
|
|
|
$
|
50.3
|
|
Other comprehensive income (loss):
|
|
|
|
|
|
|
|
||||||||
Net foreign currency translation adjustment
|
0.3
|
|
|
(8.1
|
)
|
|
(2.5
|
)
|
|
(11.1
|
)
|
||||
Net unrealized loss on derivative instruments, net of tax of $1.8, $2.5, $1.0 and $3.1, respectively
|
(2.9
|
)
|
|
(4.0
|
)
|
|
(1.6
|
)
|
|
(5.1
|
)
|
||||
Reclassification of net unrealized losses on derivatives to net income, net of tax of $1.7, $1.5, $2.2 and $2.1, respectively
|
2.8
|
|
|
2.4
|
|
|
3.6
|
|
|
3.4
|
|
||||
Reclassification of net pension and post-retirement benefit loss to net income, net of tax of $0.1, $0.5, $0.4, and $1.0, respectively
|
0.2
|
|
|
0.8
|
|
|
0.7
|
|
|
1.6
|
|
||||
Total other comprehensive income (loss)
|
0.4
|
|
|
(8.9
|
)
|
|
0.2
|
|
|
(11.2
|
)
|
||||
Comprehensive income
|
$
|
210.2
|
|
|
$
|
115.4
|
|
|
$
|
129.3
|
|
|
$
|
39.1
|
|
|
SIX MONTHS ENDED
|
||||||
|
APRIL 2,
2016 |
|
MARCH 28,
2015 |
||||
OPERATING ACTIVITIES
|
|
|
|
||||
Net income
|
$
|
129.1
|
|
|
$
|
50.3
|
|
Adjustments to reconcile net income to net cash used in operating activities:
|
|
|
|
||||
Impairment, restructuring and other
|
—
|
|
|
4.3
|
|
||
Costs related to refinancing
|
2.2
|
|
|
—
|
|
||
Share-based compensation expense
|
11.3
|
|
|
9.3
|
|
||
Depreciation
|
27.3
|
|
|
24.9
|
|
||
Amortization
|
9.5
|
|
|
7.1
|
|
||
Gain on sale of assets
|
(0.3
|
)
|
|
(0.6
|
)
|
||
Changes in assets and liabilities, net of acquired businesses:
|
|
|
|
||||
Accounts receivable
|
(834.6
|
)
|
|
(734.7
|
)
|
||
Inventories
|
(224.3
|
)
|
|
(215.8
|
)
|
||
Prepaid and other assets
|
(48.2
|
)
|
|
(37.8
|
)
|
||
Accounts payable
|
105.0
|
|
|
117.7
|
|
||
Other current liabilities
|
207.5
|
|
|
113.0
|
|
||
Restructuring reserves
|
(8.9
|
)
|
|
2.8
|
|
||
Other non-current items
|
(2.8
|
)
|
|
3.5
|
|
||
Other, net
|
(0.6
|
)
|
|
7.3
|
|
||
Net cash used in operating activities
|
(627.8
|
)
|
|
(648.7
|
)
|
||
|
|
|
|
||||
INVESTING ACTIVITIES
|
|
|
|
||||
Proceeds from sale of long-lived assets
|
0.2
|
|
|
5.2
|
|
||
Investments in property, plant and equipment
|
(24.4
|
)
|
|
(28.0
|
)
|
||
Investment in loan receivable
|
(72.0
|
)
|
|
—
|
|
||
Investment in unconsolidated affiliates
|
(2.0
|
)
|
|
—
|
|
||
Investments in acquired businesses, net of cash acquired
|
—
|
|
|
(50.5
|
)
|
||
Net cash used in investing activities
|
(98.2
|
)
|
|
(73.3
|
)
|
||
|
|
|
|
||||
FINANCING ACTIVITIES
|
|
|
|
||||
Borrowings under revolving and bank lines of credit and term loans
|
1,573.2
|
|
|
1,195.5
|
|
||
Repayments under revolving and bank lines of credit and term loans
|
(959.8
|
)
|
|
(450.5
|
)
|
||
Proceeds from issuance of 6.000% Senior Notes
|
400.0
|
|
|
—
|
|
||
Repayment of 6.625% Senior Notes
|
(200.0
|
)
|
|
—
|
|
||
Financing and issuance fees
|
(10.5
|
)
|
|
—
|
|
||
Dividends paid
|
(57.7
|
)
|
|
(54.8
|
)
|
||
Purchase of Common Shares
|
(42.8
|
)
|
|
(14.8
|
)
|
||
Payments on seller notes
|
(2.3
|
)
|
|
(0.8
|
)
|
||
Excess tax benefits from share-based payment arrangements
|
4.2
|
|
|
2.8
|
|
||
Cash received from the exercise of stock options
|
9.2
|
|
|
16.2
|
|
||
Net cash provided by financing activities
|
713.5
|
|
|
693.6
|
|
||
Effect of exchange rate changes on cash
|
(1.6
|
)
|
|
(6.1
|
)
|
||
Net decrease in cash and cash equivalents
|
(14.1
|
)
|
|
(34.5
|
)
|
||
Cash and cash equivalents at beginning of period
|
71.4
|
|
|
89.3
|
|
||
Cash and cash equivalents at end of period
|
$
|
57.3
|
|
|
$
|
54.8
|
|
|
|
|
|
||||
SUPPLEMENTAL CASH FLOW INFORMATION
|
|
|
|
||||
Interest paid
|
$
|
(23.0
|
)
|
|
$
|
(20.6
|
)
|
Call premium on 6.625% Senior Notes
|
(6.6
|
)
|
|
—
|
|
||
Income taxes paid
|
(2.2
|
)
|
|
(10.3
|
)
|
|
APRIL 2,
2016 |
|
MARCH 28,
2015 |
|
SEPTEMBER 30,
2015 |
||||||
ASSETS
|
|||||||||||
Current assets:
|
|
|
|
|
|
||||||
Cash and cash equivalents
|
$
|
57.3
|
|
|
$
|
54.8
|
|
|
$
|
71.4
|
|
Accounts receivable, less allowances of $14.9, $11.7 and $6.5, respectively
|
954.7
|
|
|
668.6
|
|
|
157.7
|
|
|||
Accounts receivable pledged
|
208.4
|
|
|
376.7
|
|
|
152.9
|
|
|||
Inventories
|
619.6
|
|
|
584.1
|
|
|
395.8
|
|
|||
Assets held for sale
|
208.7
|
|
|
205.3
|
|
|
220.3
|
|
|||
Prepaid and other current assets
|
160.1
|
|
|
146.1
|
|
|
121.1
|
|
|||
Total current assets
|
2,208.8
|
|
|
2,035.6
|
|
|
1,119.2
|
|
|||
Property, plant and equipment, net of accumulated depreciation of $614.5 $590.3 and $593.9, respectively
|
436.3
|
|
|
427.2
|
|
|
444.1
|
|
|||
Goodwill
|
284.9
|
|
|
223.1
|
|
|
283.8
|
|
|||
Intangible assets, net
|
646.8
|
|
|
298.5
|
|
|
655.1
|
|
|||
Other assets
|
108.8
|
|
|
25.4
|
|
|
25.0
|
|
|||
Total assets
|
$
|
3,685.6
|
|
|
$
|
3,009.8
|
|
|
$
|
2,527.2
|
|
|
|
|
|
|
|
||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|||||||||||
Current liabilities:
|
|
|
|
|
|
||||||
Current portion of debt
|
$
|
202.9
|
|
|
$
|
315.3
|
|
|
$
|
132.6
|
|
Accounts payable
|
293.8
|
|
|
294.5
|
|
|
193.1
|
|
|||
Liabilities held for sale
|
62.1
|
|
|
56.6
|
|
|
41.7
|
|
|||
Other current liabilities
|
427.1
|
|
|
324.2
|
|
|
251.2
|
|
|||
Total current liabilities
|
985.9
|
|
|
990.6
|
|
|
618.6
|
|
|||
Long-term debt
|
1,764.8
|
|
|
1,207.5
|
|
|
1,025.0
|
|
|||
Other liabilities
|
247.0
|
|
|
241.8
|
|
|
250.5
|
|
|||
Total liabilities
|
2,997.7
|
|
|
2,439.9
|
|
|
1,894.1
|
|
|||
Contingencies (Note 11)
|
|
|
|
|
|
||||||
Shareholders’ equity:
|
|
|
|
|
|
||||||
Common shares and capital in excess of $.01 stated value per share; 61.2, 61.1 and 61.4 shares issued and outstanding, respectively
|
401.9
|
|
|
399.4
|
|
|
400.4
|
|
|||
Retained earnings
|
756.4
|
|
|
632.4
|
|
|
684.2
|
|
|||
Treasury shares, at cost; 6.9, 7.0 and 6.7 shares, respectively
|
(376.3
|
)
|
|
(378.3
|
)
|
|
(357.1
|
)
|
|||
Accumulated other comprehensive loss
|
(106.6
|
)
|
|
(97.4
|
)
|
|
(106.8
|
)
|
|||
Total shareholders’ equity - controlling interest
|
675.4
|
|
|
556.1
|
|
|
620.7
|
|
|||
Noncontrolling interest
|
12.5
|
|
|
13.8
|
|
|
12.4
|
|
|||
Total equity
|
687.9
|
|
|
569.9
|
|
|
633.1
|
|
|||
Total liabilities and equity
|
$
|
3,685.6
|
|
|
$
|
3,009.8
|
|
|
$
|
2,527.2
|
|
|
THREE MONTHS ENDED
|
|
SIX MONTHS ENDED
|
||||||||||||
|
APRIL 2,
2016 |
|
MARCH 28,
2015 |
|
APRIL 2,
2016 |
|
MARCH 28,
2015 |
||||||||
|
(In millions)
|
||||||||||||||
Net sales
|
$
|
40.9
|
|
|
$
|
30.5
|
|
|
$
|
92.0
|
|
|
$
|
77.2
|
|
Operating costs
|
55.7
|
|
|
52.8
|
|
|
107.1
|
|
|
98.4
|
|
||||
Impairment, restructuring and other
|
10.6
|
|
|
0.3
|
|
|
13.6
|
|
|
1.4
|
|
||||
Other income, net
|
(0.7
|
)
|
|
(0.3
|
)
|
|
(1.5
|
)
|
|
(1.2
|
)
|
||||
Loss from discontinued operations before income taxes
|
(24.7
|
)
|
|
(22.3
|
)
|
|
(27.2
|
)
|
|
(21.4
|
)
|
||||
Income tax benefit from discontinued operations
|
(8.7
|
)
|
|
(8.0
|
)
|
|
(9.7
|
)
|
|
(7.7
|
)
|
||||
Loss from discontinued operations, net of tax
|
$
|
(16.0
|
)
|
|
$
|
(14.3
|
)
|
|
$
|
(17.5
|
)
|
|
$
|
(13.7
|
)
|
|
APRIL 2,
2016 |
|
MARCH 28,
2015 |
|
SEPTEMBER 30,
2015 |
||||||
|
(In millions)
|
||||||||||
Accounts receivable, net
|
$
|
17.2
|
|
|
$
|
13.5
|
|
|
$
|
33.6
|
|
Inventories
|
13.8
|
|
|
12.0
|
|
|
11.8
|
|
|||
Prepaid and other assets
|
13.1
|
|
|
11.5
|
|
|
8.3
|
|
|||
Property, plant and equipment, net
|
8.4
|
|
|
9.8
|
|
|
9.6
|
|
|||
Goodwill and intangible assets, net
|
156.2
|
|
|
158.5
|
|
|
157.0
|
|
|||
Assets held for sale
|
$
|
208.7
|
|
|
$
|
205.3
|
|
|
$
|
220.3
|
|
|
|
|
|
|
|
||||||
Current portion of debt
|
$
|
0.3
|
|
|
$
|
2.8
|
|
|
$
|
2.2
|
|
Accounts payable
|
4.5
|
|
|
5.9
|
|
|
4.8
|
|
|||
Other current liabilities
|
52.1
|
|
|
42.5
|
|
|
29.2
|
|
|||
Long-term debt
|
3.3
|
|
|
3.6
|
|
|
3.5
|
|
|||
Other liabilities
|
1.9
|
|
|
1.8
|
|
|
2.0
|
|
|||
Liabilities held for sale
|
$
|
62.1
|
|
|
$
|
56.6
|
|
|
$
|
41.7
|
|
|
THREE MONTHS ENDED
|
|
SIX MONTHS ENDED
|
||||||||||||
|
APRIL 2,
2016 |
|
MARCH 28,
2015 |
|
APRIL 2,
2016 |
|
MARCH 28,
2015 |
||||||||
|
(In millions)
|
||||||||||||||
Restructuring and other from continuing operations
|
$
|
(47.1
|
)
|
|
$
|
4.8
|
|
|
$
|
(40.8
|
)
|
|
$
|
13.3
|
|
Restructuring and other from discontinued operations
|
10.6
|
|
|
0.3
|
|
|
13.6
|
|
|
1.4
|
|
||||
Total impairment, restructuring and other
|
$
|
(36.5
|
)
|
|
$
|
5.1
|
|
|
$
|
(27.2
|
)
|
|
$
|
14.7
|
|
Amounts reserved for restructuring and other at September 30, 2015
|
$
|
28.1
|
|
Restructuring and other from continuing operations
|
9.2
|
|
|
Restructuring and other from discontinued operations
|
13.6
|
|
|
Payments and other
|
(31.7
|
)
|
|
Amounts reserved for restructuring and other at April 2, 2016
|
$
|
19.2
|
|
|
APRIL 2,
2016 |
|
MARCH 28,
2015 |
|
SEPTEMBER 30,
2015 |
||||||
|
(In millions)
|
||||||||||
Finished goods
|
$
|
419.2
|
|
|
$
|
385.6
|
|
|
$
|
218.9
|
|
Work-in-process
|
50.4
|
|
|
49.0
|
|
|
48.3
|
|
|||
Raw materials
|
150.0
|
|
|
149.5
|
|
|
128.6
|
|
|||
Total inventories
|
$
|
619.6
|
|
|
$
|
584.1
|
|
|
$
|
395.8
|
|
•
|
Expands the territories in which the Company may serve as Monsanto’s exclusive agent in the consumer lawn and garden market to include all countries other than Japan and countries subject to a comprehensive U.S. trade embargo or certain other embargoes and trade restrictions.
|
•
|
Eliminates the initial and renewal terms that the original Marketing Agreement applied to European Union (“EU”) countries. As amended, the term of the Marketing Agreement will now continue indefinitely for all included markets, including EU countries within the included markets, unless and until otherwise terminated in accordance with the Marketing Agreement.
|
•
|
Revises the procedures of the Marketing Agreement relating to a potential sale of the consumer Roundup
®
business to (1) require Monsanto to negotiate exclusively with the Company with respect to any potential Roundup
®
sale for 60 days after the Company receives notice from Monsanto regarding a potential Roundup
®
sale and (2) provide the Company with a right of first offer and a right of last look in connection with a potential Roundup
®
sale to a third party.
|
•
|
Requires the Company to (1) provide notice to Monsanto of certain proposals and processes that may result in a sale of the Company and (2) conduct non-exclusive negotiations with Monsanto with respect to such a sale.
|
•
|
Increases the minimum termination fee payable under the Marketing Agreement to the greater of (1) $200.0 million or (2) four times (A) the average of the program earnings before interest or income taxes for the three trailing program years prior to the year of termination, minus (B) the 2015 program earnings before interest or income taxes.
|
•
|
Amends Monsanto’s termination rights and provides additional rights to the Company in the event of a termination, as follows:
|
◦
|
delays the effectiveness of a notice of termination given by Monsanto as a result of a change of control with respect to Monsanto or a sale of the consumer Roundup
®
business to a third party from (1) the end of the later of 12 months or the next program year to (2) the end of the fifth full program year after Monsanto gives such notice;
|
◦
|
eliminates Monsanto’s termination rights for a regional performance default, a change of significant ownership of the Company or an uncured or incurable egregious injury (as each is defined in the Marketing Agreement); and
|
◦
|
eliminates Monsanto’s termination rights in connection with a change in control of the Company or Scotts Miracle-Gro as long as the Company has determined, in its reasonable commercial opinion, that the acquirer can and will fully perform the duties and obligations of the Company under the Marketing Agreement.
|
•
|
Expands the Company’s termination rights to include termination for a brand decline event (as defined in the Marketing Agreement Amendment) occurring before program year 2023.
|
•
|
Expands the Company’s assignment rights to allow the Company to transfer its rights, interests and obligations under the Marketing Agreement with respect to (1) the North America territories and (2) one or more other included markets for up to three other assignments.
|
•
|
Amends the commission structure by (1) eliminating the commission threshold for program years 2016, 2017 and 2018, (2) setting the commission threshold for the subsequent program years at
$40 million
and (3) establishing the commission payable by Monsanto to the Company for each program year at an amount equal to 50% of the program earnings before interest and income taxes for such program year.
|
|
THREE MONTHS ENDED
|
|
SIX MONTHS ENDED
|
||||||||||||
|
APRIL 2,
2016 |
|
MARCH 28,
2015 |
|
APRIL 2,
2016 |
|
MARCH 28,
2015 |
||||||||
|
(In millions)
|
||||||||||||||
Gross commission
|
$
|
54.9
|
|
|
$
|
32.5
|
|
|
$
|
54.9
|
|
|
$
|
32.5
|
|
Contribution expenses
|
(5.0
|
)
|
|
(5.0
|
)
|
|
(10.0
|
)
|
|
(10.0
|
)
|
||||
Amortization of marketing fee
|
(0.2
|
)
|
|
(0.2
|
)
|
|
(0.4
|
)
|
|
(0.4
|
)
|
||||
Net commission
|
49.7
|
|
|
27.3
|
|
|
44.5
|
|
|
22.1
|
|
||||
Reimbursements associated with Marketing Agreement
|
22.8
|
|
|
18.2
|
|
|
36.8
|
|
|
35.5
|
|
||||
Total net sales associated with Marketing Agreement
|
$
|
72.5
|
|
|
$
|
45.5
|
|
|
$
|
81.3
|
|
|
$
|
57.6
|
|
|
APRIL 2,
2016 |
|
MARCH 28,
2015 |
|
SEPTEMBER 30,
2015 |
||||||
|
(In millions)
|
||||||||||
Credit Facilities:
|
|
|
|
|
|
||||||
Revolving loans
|
$
|
1,075.0
|
|
|
$
|
998.9
|
|
|
$
|
816.3
|
|
Term loans
|
296.3
|
|
|
—
|
|
|
—
|
|
|||
Senior Notes – 6.625%
|
—
|
|
|
200.0
|
|
|
200.0
|
|
|||
Senior Notes – 6.000%
|
400.0
|
|
|
—
|
|
|
—
|
|
|||
Master Accounts Receivable Purchase Agreement
|
166.7
|
|
|
301.3
|
|
|
122.3
|
|
|||
Other
|
29.7
|
|
|
22.6
|
|
|
19.0
|
|
|||
|
1,967.7
|
|
|
1,522.8
|
|
|
1,157.6
|
|
|||
Less current portions
|
202.9
|
|
|
315.3
|
|
|
132.6
|
|
|||
Long-term debt
|
$
|
1,764.8
|
|
|
$
|
1,207.5
|
|
|
$
|
1,025.0
|
|
Notional Amount
(in millions)
|
|
Effective
Date (a)
|
|
Expiration
Date
|
|
Fixed
Rate
|
||
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
|
|
(b)
|
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
|
||||||||||||||||||||||
|
APRIL 2, 2016
|
|
MARCH 28, 2015
|
||||||||||||||||||||
|
U.S.
Pension
|
|
International
Pension
|
|
U.S.
Medical
|
|
U.S.
Pension
|
|
International
Pension
|
|
U.S.
Medical
|
||||||||||||
|
(In millions)
|
||||||||||||||||||||||
Service cost
|
$
|
—
|
|
|
$
|
0.3
|
|
|
$
|
0.1
|
|
|
$
|
—
|
|
|
$
|
0.4
|
|
|
$
|
0.1
|
|
Interest cost
|
1.1
|
|
|
1.7
|
|
|
0.2
|
|
|
1.0
|
|
|
1.9
|
|
|
0.3
|
|
||||||
Expected return on plan assets
|
(1.3
|
)
|
|
(2.0
|
)
|
|
—
|
|
|
(1.4
|
)
|
|
(2.4
|
)
|
|
—
|
|
||||||
Net amortization
|
0.5
|
|
|
0.4
|
|
|
(0.2
|
)
|
|
0.8
|
|
|
0.4
|
|
|
—
|
|
||||||
Net periodic benefit cost
|
$
|
0.3
|
|
|
$
|
0.4
|
|
|
$
|
0.1
|
|
|
$
|
0.4
|
|
|
$
|
0.3
|
|
|
$
|
0.4
|
|
|
SIX MONTHS ENDED
|
||||||||||||||||||||||
|
APRIL 2, 2016
|
|
MARCH 28, 2015
|
||||||||||||||||||||
|
U.S.
Pension
|
|
International
Pension
|
|
U.S.
Medical
|
|
U.S.
Pension
|
|
International
Pension
|
|
U.S.
Medical
|
||||||||||||
|
(In millions)
|
||||||||||||||||||||||
Service cost
|
$
|
—
|
|
|
$
|
0.6
|
|
|
$
|
0.2
|
|
|
$
|
—
|
|
|
$
|
0.7
|
|
|
$
|
0.2
|
|
Interest cost
|
2.2
|
|
|
3.4
|
|
|
0.5
|
|
|
2.0
|
|
|
3.8
|
|
|
0.6
|
|
||||||
Expected return on plan assets
|
(2.5
|
)
|
|
(4.0
|
)
|
|
—
|
|
|
(2.7
|
)
|
|
(4.7
|
)
|
|
—
|
|
||||||
Net amortization
|
0.9
|
|
|
0.8
|
|
|
(0.5
|
)
|
|
1.6
|
|
|
0.9
|
|
|
—
|
|
||||||
Net periodic benefit cost
|
$
|
0.6
|
|
|
$
|
0.8
|
|
|
$
|
0.2
|
|
|
$
|
0.9
|
|
|
$
|
0.7
|
|
|
$
|
0.8
|
|
|
SIX MONTHS ENDED
|
||||||
|
APRIL 2, 2016
|
|
MARCH 28, 2015
|
||||
Employees
|
|
|
|
||||
Stock options
|
444,890
|
|
|
420,047
|
|
||
Restricted stock units
|
70,594
|
|
|
52,091
|
|
||
Performance units
|
56,315
|
|
|
78,352
|
|
||
Board of Directors
|
|
|
|
||||
Deferred stock units
|
26,560
|
|
|
27,282
|
|
||
Total share-based awards
|
598,359
|
|
|
577,772
|
|
||
|
|
|
|
||||
Aggregate fair value at grant dates (in millions)
|
$
|
16.0
|
|
|
$
|
14.8
|
|
|
THREE MONTHS ENDED
|
|
SIX MONTHS ENDED
|
||||||||||||
|
APRIL 2, 2016
|
|
MARCH 28, 2015
|
|
APRIL 2, 2016
|
|
MARCH 28, 2015
|
||||||||
|
(In millions)
|
||||||||||||||
Share-based compensation
|
$
|
9.1
|
|
|
$
|
7.2
|
|
|
$
|
11.3
|
|
|
$
|
9.3
|
|
Tax benefit recognized
|
3.5
|
|
|
2.7
|
|
|
4.3
|
|
|
3.5
|
|
|
No. of
Options
|
|
WTD. Avg.
Exercise Price
|
|||
Awards outstanding at September 30, 2015
|
1.8
|
|
|
$
|
44.38
|
|
Granted
|
0.4
|
|
|
68.68
|
|
|
Exercised
|
(0.2
|
)
|
|
38.13
|
|
|
Forfeited
|
—
|
|
|
—
|
|
|
Awards outstanding at April 2, 2016
|
2.0
|
|
|
50.51
|
|
|
Exercisable
|
1.1
|
|
|
38.25
|
|
|
|
Awards Outstanding
|
|
Awards Exercisable
|
|||||||||||||||
Range of
Exercise Price
|
|
No. of
Options
|
|
WTD.
Avg.
Remaining
Life
|
|
WTD.
Avg.
Exercise
Price
|
|
No. of
Options
|
|
WTD.
Avg.
Remaining
Life
|
|
WTD.
Avg.
Exercise
Price
|
|||||||
$20.59 – $20.59
|
|
0.3
|
|
|
2.51
|
|
$
|
20.59
|
|
|
0.3
|
|
|
2.51
|
|
|
$
|
20.59
|
|
$30.07 – $36.86
|
|
0.2
|
|
|
1.45
|
|
36.20
|
|
|
0.2
|
|
|
1.45
|
|
|
36.20
|
|
||
$38.81 – $49.19
|
|
0.6
|
|
|
4.67
|
|
45.25
|
|
|
0.6
|
|
|
4.67
|
|
|
45.25
|
|
||
$63.43 – $68.68
|
|
0.9
|
|
|
9.35
|
|
66.21
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||
|
|
2.0
|
|
|
6.10
|
|
$
|
50.51
|
|
|
1.1
|
|
|
3.57
|
|
|
$
|
38.25
|
|
|
(In millions)
|
||
Outstanding
|
$
|
44.2
|
|
Exercisable
|
38.4
|
|
Expected market price volatility
|
25.5
|
%
|
Risk-free interest rates
|
1.5
|
%
|
Expected dividend yield
|
2.7
|
%
|
Expected life of stock options in years
|
6.02
|
|
Estimated weighted-average fair value per stock option
|
$12.33
|
|
No. of
Shares
|
|
WTD. Avg.
Grant Date
Fair Value
per Share
|
|||
Awards outstanding at September 30, 2015
|
381,509
|
|
|
$
|
57.22
|
|
Granted
|
97,154
|
|
|
68.81
|
|
|
Vested
|
(154,570
|
)
|
|
47.05
|
|
|
Forfeited
|
(9,228
|
)
|
|
57.45
|
|
|
Awards outstanding at April 2, 2016
|
314,865
|
|
|
60.25
|
|
|
No. of
Units
|
|
WTD. Avg.
Grant Date
Fair Value
per Unit
|
|||
Awards outstanding at September 30, 2015
|
339,224
|
|
|
$
|
54.86
|
|
Granted
|
56,315
|
|
|
68.68
|
|
|
Vested
|
(128,941
|
)
|
|
45.06
|
|
|
Forfeited
|
—
|
|
|
—
|
|
|
Awards outstanding at April 2, 2016
|
266,598
|
|
|
62.52
|
|
COMMODITY
|
|
APRIL 2, 2016
|
|
MARCH 28, 2015
|
|
SEPTEMBER 30, 2015
|
Urea
|
|
21,000 tons
|
|
21,000 tons
|
|
52,500 tons
|
Diesel
|
|
5,922,000 gallons
|
|
4,998,000 gallons
|
|
5,250,000 gallons
|
Heating Oil
|
|
1,974,000 gallons
|
|
5,754,000 gallons
|
|
2,772,000 gallons
|
DERIVATIVES IN CASH FLOW HEDGING RELATIONSHIPS
|
|
AMOUNT OF GAIN / (LOSS) RECOGNIZED IN AOCI
|
||||||||||||||
|
THREE MONTHS ENDED
|
|
SIX MONTHS ENDED
|
|||||||||||||
|
APRIL 2,
2016 |
|
MARCH 28,
2015 |
|
APRIL 2,
2016 |
|
MARCH 28,
2015 |
|||||||||
|
|
(In millions)
|
||||||||||||||
Interest rate swap agreements
|
|
$
|
(2.6
|
)
|
|
$
|
(3.0
|
)
|
|
$
|
(0.9
|
)
|
|
$
|
(4.7
|
)
|
Commodity hedging instruments
|
|
(0.3
|
)
|
|
(1.0
|
)
|
|
(0.7
|
)
|
|
(0.4
|
)
|
||||
Total
|
|
$
|
(2.9
|
)
|
|
$
|
(4.0
|
)
|
|
$
|
(1.6
|
)
|
|
$
|
(5.1
|
)
|
DERIVATIVES IN CASH FLOW HEDGING RELATIONSHIPS
|
|
RECLASSIFIED FROM AOCI INTO STATEMENT OF OPERATIONS
|
|
AMOUNT OF GAIN / (LOSS)
|
||||||||||||||
THREE MONTHS ENDED
|
|
SIX MONTHS ENDED
|
||||||||||||||||
APRIL 2,
2016 |
|
MARCH 28,
2015 |
|
APRIL 2,
2016 |
|
MARCH 28,
2015 |
||||||||||||
|
|
|
|
(In millions)
|
||||||||||||||
Interest rate swap agreements
|
|
Interest expense
|
|
$
|
(2.2
|
)
|
|
$
|
(2.5
|
)
|
|
$
|
(3.2
|
)
|
|
$
|
(3.5
|
)
|
Commodity hedging instruments
|
|
Cost of sales
|
|
(0.6
|
)
|
|
0.1
|
|
|
(0.4
|
)
|
|
0.1
|
|
||||
Total
|
|
$
|
(2.8
|
)
|
|
$
|
(2.4
|
)
|
|
$
|
(3.6
|
)
|
|
$
|
(3.4
|
)
|
DERIVATIVES NOT DESIGNATED AS HEDGING INSTRUMENTS
|
|
RECOGNIZED IN
STATEMENT OF OPERATIONS
|
|
AMOUNT OF GAIN / (LOSS)
|
||||||||||||||
THREE MONTHS ENDED
|
|
SIX MONTHS ENDED
|
||||||||||||||||
APRIL 2,
2016 |
|
MARCH 28,
2015 |
|
APRIL 2,
2016 |
|
MARCH 28,
2015 |
||||||||||||
|
|
|
|
(In millions)
|
||||||||||||||
Currency forward contracts
|
|
Other income, net
|
|
$
|
(0.3
|
)
|
|
$
|
2.1
|
|
|
$
|
(1.1
|
)
|
|
$
|
5.2
|
|
Commodity hedging instruments
|
|
Cost of sales
|
|
(1.0
|
)
|
|
(1.5
|
)
|
|
(4.3
|
)
|
|
(8.7
|
)
|
||||
Total
|
|
$
|
(1.3
|
)
|
|
$
|
0.6
|
|
|
$
|
(5.4
|
)
|
|
$
|
(3.5
|
)
|
|
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
|
$
|
22.6
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
22.6
|
|
Other
|
11.1
|
|
|
—
|
|
|
—
|
|
|
11.1
|
|
||||
Total
|
$
|
33.7
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
33.7
|
|
Liabilities
|
|
|
|
|
|
|
|
||||||||
Derivatives
|
|
|
|
|
|
|
|
||||||||
Interest rate swap agreements
|
$
|
—
|
|
|
$
|
(10.9
|
)
|
|
$
|
—
|
|
|
$
|
(10.9
|
)
|
Currency forward contracts
|
—
|
|
|
(0.2
|
)
|
|
—
|
|
|
(0.2
|
)
|
||||
Commodity hedging instruments
|
—
|
|
|
(4.5
|
)
|
|
—
|
|
|
(4.5
|
)
|
||||
Total
|
$
|
—
|
|
|
$
|
(15.6
|
)
|
|
$
|
—
|
|
|
$
|
(15.6
|
)
|
|
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
|
$
|
17.8
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
17.8
|
|
Derivatives
|
|
|
|
|
|
|
|
||||||||
Interest rate swap agreements
|
—
|
|
|
0.1
|
|
|
—
|
|
|
0.1
|
|
||||
Other
|
10.5
|
|
|
—
|
|
|
—
|
|
|
10.5
|
|
||||
Total
|
$
|
28.3
|
|
|
$
|
0.1
|
|
|
$
|
—
|
|
|
$
|
28.4
|
|
Liabilities
|
|
|
|
|
|
|
|
||||||||
Derivatives
|
|
|
|
|
|
|
|
||||||||
Interest rate swap agreements
|
$
|
—
|
|
|
$
|
(14.9
|
)
|
|
$
|
—
|
|
|
$
|
(14.9
|
)
|
Currency forward contracts
|
—
|
|
|
(0.2
|
)
|
|
—
|
|
|
(0.2
|
)
|
||||
Commodity hedging instruments
|
—
|
|
|
(6.7
|
)
|
|
—
|
|
|
(6.7
|
)
|
||||
Total
|
$
|
—
|
|
|
$
|
(21.8
|
)
|
|
$
|
—
|
|
|
$
|
(21.8
|
)
|
|
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
|
$
|
28.6
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
28.6
|
|
Other
|
8.9
|
|
|
—
|
|
|
—
|
|
|
8.9
|
|
||||
Total
|
$
|
37.5
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
37.5
|
|
Liabilities
|
|
|
|
|
|
|
|
||||||||
Derivatives
|
|
|
|
|
|
|
|
||||||||
Interest rate swap agreements
|
$
|
—
|
|
|
$
|
(13.4
|
)
|
|
$
|
—
|
|
|
$
|
(13.4
|
)
|
Currency forward contracts
|
—
|
|
|
(0.7
|
)
|
|
—
|
|
|
(0.7
|
)
|
||||
Commodity hedging instruments
|
—
|
|
|
(4.5
|
)
|
|
—
|
|
|
(4.5
|
)
|
||||
Total
|
$
|
—
|
|
|
$
|
(18.6
|
)
|
|
$
|
—
|
|
|
$
|
(18.6
|
)
|
|
THREE MONTHS ENDED
|
|
SIX MONTHS ENDED
|
||||||||||||
|
APRIL 2,
2016 |
|
MARCH 28,
2015 |
|
APRIL 2,
2016 |
|
MARCH 28,
2015 |
||||||||
|
(In millions)
|
||||||||||||||
Net sales:
|
|
|
|
|
|
|
|
||||||||
U.S. Consumer
|
$
|
1,039.7
|
|
|
$
|
893.2
|
|
|
$
|
1,152.9
|
|
|
$
|
990.4
|
|
Europe Consumer
|
115.0
|
|
|
118.1
|
|
|
140.7
|
|
|
150.6
|
|
||||
Other
|
90.5
|
|
|
60.5
|
|
|
146.1
|
|
|
100.3
|
|
||||
Consolidated
|
$
|
1,245.2
|
|
|
$
|
1,071.8
|
|
|
$
|
1,439.7
|
|
|
$
|
1,241.3
|
|
Income from continuing operations before income taxes:
|
|
|
|
|
|
|
|
||||||||
U.S. Consumer
|
$
|
336.0
|
|
|
$
|
250.6
|
|
|
$
|
281.8
|
|
|
$
|
192.0
|
|
Europe Consumer
|
21.6
|
|
|
20.7
|
|
|
12.4
|
|
|
8.9
|
|
||||
Other
|
4.6
|
|
|
0.9
|
|
|
5.1
|
|
|
(2.5
|
)
|
||||
Segment total
|
362.2
|
|
|
272.2
|
|
|
299.3
|
|
|
198.4
|
|
||||
Corporate
|
(35.7
|
)
|
|
(32.7
|
)
|
|
(60.1
|
)
|
|
(53.9
|
)
|
||||
Intangible asset amortization
|
(4.3
|
)
|
|
(3.1
|
)
|
|
(8.2
|
)
|
|
(6.5
|
)
|
||||
Impairment, restructuring and other
|
47.0
|
|
|
(4.8
|
)
|
|
40.5
|
|
|
(13.3
|
)
|
||||
Costs related to refinancing
|
—
|
|
|
—
|
|
|
(8.8
|
)
|
|
—
|
|
||||
Interest expense
|
(19.1
|
)
|
|
(15.0
|
)
|
|
(35.4
|
)
|
|
(24.7
|
)
|
||||
Consolidated
|
$
|
350.1
|
|
|
$
|
216.6
|
|
|
$
|
227.3
|
|
|
$
|
100.0
|
|
|
APRIL 2,
2016 |
|
MARCH 28,
2015 |
|
SEPTEMBER 30,
2015 |
||||||
|
(In millions)
|
||||||||||
Total assets:
|
|
|
|
|
|
||||||
U.S. Consumer
|
$
|
2,636.0
|
|
|
$
|
2,113.4
|
|
|
$
|
1,622.5
|
|
Europe Consumer
|
322.6
|
|
|
327.7
|
|
|
217.9
|
|
|||
Other
|
367.8
|
|
|
225.0
|
|
|
324.1
|
|
|||
Corporate
|
150.5
|
|
|
138.4
|
|
|
142.4
|
|
|||
Assets held for sale
|
208.7
|
|
|
205.3
|
|
|
220.3
|
|
|||
Consolidated
|
$
|
3,685.6
|
|
|
$
|
3,009.8
|
|
|
$
|
2,527.2
|
|
|
Parent
|
|
Subsidiary
Guarantors
|
|
Non-
Guarantors
|
|
Eliminations/
Consolidations
|
|
Consolidated
|
||||||||||
Net sales
|
$
|
—
|
|
|
$
|
1,069.0
|
|
|
$
|
176.2
|
|
|
$
|
—
|
|
|
$
|
1,245.2
|
|
Cost of sales
|
—
|
|
|
605.2
|
|
|
118.3
|
|
|
—
|
|
|
723.5
|
|
|||||
Cost of sales—impairment, restructuring and other
|
—
|
|
|
0.1
|
|
|
—
|
|
|
—
|
|
|
0.1
|
|
|||||
Gross profit
|
—
|
|
|
463.7
|
|
|
57.9
|
|
|
—
|
|
|
521.6
|
|
|||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
||||||||||
Selling, general and administrative
|
—
|
|
|
162.6
|
|
|
37.9
|
|
|
0.4
|
|
|
200.9
|
|
|||||
Impairment, restructuring and other
|
—
|
|
|
(47.5
|
)
|
|
0.3
|
|
|
—
|
|
|
(47.2
|
)
|
|||||
Other income, net
|
—
|
|
|
(0.4
|
)
|
|
(0.9
|
)
|
|
—
|
|
|
(1.3
|
)
|
|||||
Income from operations
|
—
|
|
|
349.0
|
|
|
20.6
|
|
|
(0.4
|
)
|
|
369.2
|
|
|||||
Equity income in subsidiaries
|
(216.6
|
)
|
|
(7.7
|
)
|
|
—
|
|
|
224.3
|
|
|
—
|
|
|||||
Other non-operating income
|
(8.7
|
)
|
|
—
|
|
|
(6.2
|
)
|
|
14.9
|
|
|
—
|
|
|||||
Interest expense
|
18.2
|
|
|
14.6
|
|
|
1.2
|
|
|
(14.9
|
)
|
|
19.1
|
|
|||||
Income from continuing operations before income taxes
|
207.1
|
|
|
342.1
|
|
|
25.6
|
|
|
(224.7
|
)
|
|
350.1
|
|
|||||
Income tax expense (benefit) from continuing operations
|
(3.4
|
)
|
|
118.5
|
|
|
9.2
|
|
|
—
|
|
|
124.3
|
|
|||||
Income from continuing operations
|
210.5
|
|
|
223.6
|
|
|
16.4
|
|
|
(224.7
|
)
|
|
225.8
|
|
|||||
Loss from discontinued operations, net of tax
|
—
|
|
|
(16.0
|
)
|
|
—
|
|
|
—
|
|
|
(16.0
|
)
|
|||||
Net income
|
$
|
210.5
|
|
|
$
|
207.6
|
|
|
$
|
16.4
|
|
|
$
|
(224.7
|
)
|
|
$
|
209.8
|
|
Net loss attributable to noncontrolling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
0.3
|
|
|
0.3
|
|
|||||
Net income attributable to controlling interest
|
$
|
210.5
|
|
|
$
|
207.6
|
|
|
$
|
16.4
|
|
|
$
|
(224.4
|
)
|
|
$
|
210.1
|
|
|
Parent
|
|
Subsidiary
Guarantors
|
|
Non-
Guarantors
|
|
Eliminations/
Consolidations
|
|
Consolidated
|
||||||||||
Net sales
|
$
|
—
|
|
|
$
|
1,199.3
|
|
|
$
|
240.4
|
|
|
$
|
—
|
|
|
$
|
1,439.7
|
|
Cost of sales
|
—
|
|
|
730.0
|
|
|
166.3
|
|
|
—
|
|
|
896.3
|
|
|||||
Cost of sales—impairment, restructuring and other
|
—
|
|
|
5.1
|
|
|
—
|
|
|
—
|
|
|
5.1
|
|
|||||
Gross profit
|
—
|
|
|
464.2
|
|
|
74.1
|
|
|
—
|
|
|
538.3
|
|
|||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
||||||||||
Selling, general and administrative
|
—
|
|
|
247.3
|
|
|
66.2
|
|
|
0.7
|
|
|
314.2
|
|
|||||
Impairment, restructuring and other
|
—
|
|
|
(46.2
|
)
|
|
0.3
|
|
|
—
|
|
|
(45.9
|
)
|
|||||
Other income, net
|
—
|
|
|
(1.3
|
)
|
|
(0.2
|
)
|
|
—
|
|
|
(1.5
|
)
|
|||||
Income from operations
|
—
|
|
|
264.4
|
|
|
7.8
|
|
|
(0.7
|
)
|
|
271.5
|
|
|||||
Equity income in subsidiaries
|
(149.0
|
)
|
|
(5.3
|
)
|
|
—
|
|
|
154.3
|
|
|
—
|
|
|||||
Other non-operating income
|
(13.2
|
)
|
|
—
|
|
|
(12.3
|
)
|
|
25.5
|
|
|
—
|
|
|||||
Costs related to refinancing
|
8.8
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
8.8
|
|
|||||
Interest expense
|
34.2
|
|
|
24.7
|
|
|
2.0
|
|
|
(25.5
|
)
|
|
35.4
|
|
|||||
Income from continuing operations before income taxes
|
119.2
|
|
|
245.0
|
|
|
18.1
|
|
|
(155.0
|
)
|
|
227.3
|
|
|||||
Income tax expense (benefit) from continuing operations
|
(10.6
|
)
|
|
84.8
|
|
|
6.5
|
|
|
—
|
|
|
80.7
|
|
|||||
Income from continuing operations
|
129.8
|
|
|
160.2
|
|
|
11.6
|
|
|
(155.0
|
)
|
|
146.6
|
|
|||||
Loss from discontinued operations, net of tax
|
—
|
|
|
(17.5
|
)
|
|
—
|
|
|
—
|
|
|
(17.5
|
)
|
|||||
Net income
|
$
|
129.8
|
|
|
$
|
142.7
|
|
|
$
|
11.6
|
|
|
$
|
(155.0
|
)
|
|
$
|
129.1
|
|
Net income attributable to noncontrolling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.1
|
)
|
|
(0.1
|
)
|
|||||
Net income attributable to controlling interest
|
$
|
129.8
|
|
|
$
|
142.7
|
|
|
$
|
11.6
|
|
|
$
|
(155.1
|
)
|
|
$
|
129.0
|
|
|
Parent
|
|
Subsidiary
Guarantors
|
|
Non-
Guarantors
|
|
Eliminations/
Consolidations
|
|
Consolidated
|
||||||||||
Net income
|
$
|
210.5
|
|
|
$
|
207.6
|
|
|
$
|
16.4
|
|
|
$
|
(224.7
|
)
|
|
$
|
209.8
|
|
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net foreign currency translation adjustment
|
0.3
|
|
|
—
|
|
|
0.3
|
|
|
(0.3
|
)
|
|
0.3
|
|
|||||
Net change in derivatives
|
(0.1
|
)
|
|
0.3
|
|
|
—
|
|
|
(0.3
|
)
|
|
(0.1
|
)
|
|||||
Net change in pension and other post-retirement benefits
|
0.2
|
|
|
0.1
|
|
|
0.1
|
|
|
(0.2
|
)
|
|
0.2
|
|
|||||
Total other comprehensive income (loss)
|
0.4
|
|
|
0.4
|
|
|
0.4
|
|
|
(0.8
|
)
|
|
0.4
|
|
|||||
Comprehensive income
|
$
|
210.9
|
|
|
$
|
208.0
|
|
|
$
|
16.8
|
|
|
$
|
(225.5
|
)
|
|
$
|
210.2
|
|
|
Parent
|
|
Subsidiary
Guarantors
|
|
Non-
Guarantors
|
|
Eliminations/
Consolidations
|
|
Consolidated
|
||||||||||
Net income
|
$
|
129.8
|
|
|
$
|
142.7
|
|
|
$
|
11.6
|
|
|
$
|
(155.0
|
)
|
|
$
|
129.1
|
|
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net foreign currency translation adjustment
|
(2.5
|
)
|
|
—
|
|
|
(2.5
|
)
|
|
2.5
|
|
|
(2.5
|
)
|
|||||
Net change in derivatives
|
2.0
|
|
|
(0.3
|
)
|
|
—
|
|
|
0.3
|
|
|
2.0
|
|
|||||
Net change in pension and other post-retirement benefits
|
0.7
|
|
|
0.4
|
|
|
0.3
|
|
|
(0.7
|
)
|
|
0.7
|
|
|||||
Total other comprehensive income (loss)
|
0.2
|
|
|
0.1
|
|
|
(2.2
|
)
|
|
2.1
|
|
|
0.2
|
|
|||||
Comprehensive income
|
$
|
130.0
|
|
|
$
|
142.8
|
|
|
$
|
9.4
|
|
|
$
|
(152.9
|
)
|
|
$
|
129.3
|
|
|
Parent
|
|
Subsidiary
Guarantors
|
|
Non-
Guarantors
|
|
Eliminations/
Consolidations
|
|
Consolidated
|
||||||||||
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES
(a)
|
$
|
292.6
|
|
|
$
|
(492.8
|
)
|
|
$
|
(113.8
|
)
|
|
$
|
(313.8
|
)
|
|
$
|
(627.8
|
)
|
|
|
|
|
|
|
|
|
|
|
||||||||||
INVESTING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
||||||||||
Proceeds from sale of long-lived assets
|
—
|
|
|
0.2
|
|
|
—
|
|
|
—
|
|
|
0.2
|
|
|||||
Investments in property, plant and equipment
|
—
|
|
|
(20.8
|
)
|
|
(3.6
|
)
|
|
—
|
|
|
(24.4
|
)
|
|||||
Investment in loan receivable
|
—
|
|
|
(72.0
|
)
|
|
—
|
|
|
—
|
|
|
(72.0
|
)
|
|||||
Investment in unconsolidated affiliates
|
—
|
|
|
(2.0
|
)
|
|
—
|
|
|
—
|
|
|
(2.0
|
)
|
|||||
Investing cash flows from (to) affiliates
|
(395.0
|
)
|
|
—
|
|
|
—
|
|
|
395.0
|
|
|
—
|
|
|||||
Net cash used in investing activities
|
(395.0
|
)
|
|
(94.6
|
)
|
|
(3.6
|
)
|
|
395.0
|
|
|
(98.2
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
||||||||||
Borrowings under revolving and bank lines of credit and term loans
|
—
|
|
|
1,429.7
|
|
|
143.5
|
|
|
—
|
|
|
1,573.2
|
|
|||||
Repayments under revolving and bank lines of credit and term loans
|
—
|
|
|
(925.8
|
)
|
|
(34.0
|
)
|
|
—
|
|
|
(959.8
|
)
|
|||||
Proceeds from issuance of 6.000% Senior Notes
|
400.0
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
400.0
|
|
|||||
Repayment of 6.625% Senior Notes
|
(200.0
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(200.0
|
)
|
|||||
Financing and issuance fees
|
(10.5
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(10.5
|
)
|
|||||
Dividends paid
|
(57.7
|
)
|
|
(313.8
|
)
|
|
—
|
|
|
313.8
|
|
|
(57.7
|
)
|
|||||
Purchase of Common Shares
|
(42.8
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(42.8
|
)
|
|||||
Payments on seller notes
|
—
|
|
|
(1.8
|
)
|
|
(0.5
|
)
|
|
—
|
|
|
(2.3
|
)
|
|||||
Excess tax benefits from share-based payment arrangements
|
4.2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4.2
|
|
|||||
Cash received from the exercise of stock options
|
9.2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
9.2
|
|
|||||
Financing cash flows from (to) affiliates
|
—
|
|
|
398.5
|
|
|
(3.5
|
)
|
|
(395.0
|
)
|
|
—
|
|
|||||
Net cash provided by (used in) financing activities
|
102.4
|
|
|
586.8
|
|
|
105.5
|
|
|
(81.2
|
)
|
|
713.5
|
|
|||||
Effect of exchange rate changes on cash
|
—
|
|
|
—
|
|
|
(1.6
|
)
|
|
—
|
|
|
(1.6
|
)
|
|||||
Net increase (decrease) in cash and cash equivalents
|
—
|
|
|
(0.6
|
)
|
|
(13.5
|
)
|
|
—
|
|
|
(14.1
|
)
|
|||||
Cash and cash equivalents at beginning of period
|
—
|
|
|
8.2
|
|
|
63.2
|
|
|
—
|
|
|
71.4
|
|
|||||
Cash and cash equivalents at end of period
|
$
|
—
|
|
|
$
|
7.6
|
|
|
$
|
49.7
|
|
|
$
|
—
|
|
|
$
|
57.3
|
|
(a)
|
Cash received by the Parent from the Guarantors in the form of dividends in the amount of
$313.8 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
|
$
|
—
|
|
|
$
|
7.6
|
|
|
$
|
49.7
|
|
|
$
|
—
|
|
|
$
|
57.3
|
|
Accounts receivable, net
|
—
|
|
|
731.0
|
|
|
223.7
|
|
|
—
|
|
|
954.7
|
|
|||||
Accounts receivable pledged
|
—
|
|
|
208.4
|
|
|
—
|
|
|
—
|
|
|
208.4
|
|
|||||
Inventories
|
—
|
|
|
483.5
|
|
|
136.1
|
|
|
—
|
|
|
619.6
|
|
|||||
Assets held for sale
|
—
|
|
|
208.7
|
|
|
—
|
|
|
—
|
|
|
208.7
|
|
|||||
Prepaid and other current assets
|
—
|
|
|
122.1
|
|
|
38.0
|
|
|
—
|
|
|
160.1
|
|
|||||
Total current assets
|
—
|
|
|
1,761.3
|
|
|
447.5
|
|
|
—
|
|
|
2,208.8
|
|
|||||
Property, plant and equipment, net
|
—
|
|
|
382.3
|
|
|
54.0
|
|
|
—
|
|
|
436.3
|
|
|||||
Goodwill
|
—
|
|
|
260.5
|
|
|
12.8
|
|
|
11.6
|
|
|
284.9
|
|
|||||
Intangible assets, net
|
—
|
|
|
602.0
|
|
|
33.8
|
|
|
11.0
|
|
|
646.8
|
|
|||||
Other assets
|
21.9
|
|
|
87.2
|
|
|
15.0
|
|
|
(15.3
|
)
|
|
108.8
|
|
|||||
Equity investment in subsidiaries
|
634.8
|
|
|
—
|
|
|
—
|
|
|
(634.8
|
)
|
|
—
|
|
|||||
Intercompany assets
|
1,814.0
|
|
|
—
|
|
|
—
|
|
|
(1,814.0
|
)
|
|
—
|
|
|||||
Total assets
|
$
|
2,470.7
|
|
|
$
|
3,093.3
|
|
|
$
|
563.1
|
|
|
$
|
(2,441.5
|
)
|
|
$
|
3,685.6
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|||||||||||||||||||
Current liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Current portion of debt
|
$
|
15.0
|
|
|
$
|
182.9
|
|
|
$
|
20.0
|
|
|
$
|
(15.0
|
)
|
|
$
|
202.9
|
|
Accounts payable
|
—
|
|
|
221.9
|
|
|
71.9
|
|
|
—
|
|
|
293.8
|
|
|||||
Liabilities held for sale
|
—
|
|
|
62.1
|
|
|
—
|
|
|
—
|
|
|
62.1
|
|
|||||
Other current liabilities
|
18.9
|
|
|
318.0
|
|
|
90.2
|
|
|
—
|
|
|
427.1
|
|
|||||
Total current liabilities
|
33.9
|
|
|
784.9
|
|
|
182.1
|
|
|
(15.0
|
)
|
|
985.9
|
|
|||||
Long-term debt
|
1,756.3
|
|
|
1,168.8
|
|
|
196.0
|
|
|
(1,356.3
|
)
|
|
1,764.8
|
|
|||||
Other liabilities
|
5.1
|
|
|
221.0
|
|
|
31.2
|
|
|
(10.3
|
)
|
|
247.0
|
|
|||||
Equity investment in subsidiaries
|
—
|
|
|
176.9
|
|
|
—
|
|
|
(176.9
|
)
|
|
—
|
|
|||||
Intercompany liabilities
|
—
|
|
|
269.0
|
|
|
64.0
|
|
|
(333.0
|
)
|
|
—
|
|
|||||
Total liabilities
|
1,795.3
|
|
|
2,620.6
|
|
|
473.3
|
|
|
(1,891.5
|
)
|
|
2,997.7
|
|
|||||
Total shareholders’ equity - controlling interest
|
675.4
|
|
|
472.7
|
|
|
89.8
|
|
|
(562.5
|
)
|
|
675.4
|
|
|||||
Noncontrolling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
12.5
|
|
|
12.5
|
|
|||||
Total equity
|
675.4
|
|
|
472.7
|
|
|
89.8
|
|
|
(550.0
|
)
|
|
687.9
|
|
|||||
Total liabilities and equity
|
$
|
2,470.7
|
|
|
$
|
3,093.3
|
|
|
$
|
563.1
|
|
|
$
|
(2,441.5
|
)
|
|
$
|
3,685.6
|
|
|
Parent
|
|
Subsidiary
Guarantors
|
|
Non-
Guarantors
|
|
Eliminations/
Consolidations
|
|
Consolidated
|
||||||||||
Net sales
|
$
|
—
|
|
|
$
|
900.4
|
|
|
$
|
171.4
|
|
|
$
|
—
|
|
|
$
|
1,071.8
|
|
Cost of sales
|
—
|
|
|
531.3
|
|
|
115.5
|
|
|
—
|
|
|
646.8
|
|
|||||
Cost of sales—impairment, restructuring and other
|
—
|
|
|
—
|
|
|
0.2
|
|
|
—
|
|
|
0.2
|
|
|||||
Gross profit
|
—
|
|
|
369.1
|
|
|
55.7
|
|
|
—
|
|
|
424.8
|
|
|||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Selling, general and administrative
|
—
|
|
|
152.5
|
|
|
36.0
|
|
|
0.4
|
|
|
188.9
|
|
|||||
Impairment, restructuring and other
|
—
|
|
|
2.1
|
|
|
2.5
|
|
|
—
|
|
|
4.6
|
|
|||||
Other (income) loss, net
|
—
|
|
|
(0.5
|
)
|
|
0.2
|
|
|
—
|
|
|
(0.3
|
)
|
|||||
Income from operations
|
—
|
|
|
215.0
|
|
|
17.0
|
|
|
(0.4
|
)
|
|
231.6
|
|
|||||
Equity income in subsidiaries
|
(128.9
|
)
|
|
(6.4
|
)
|
|
—
|
|
|
135.3
|
|
|
—
|
|
|||||
Other non-operating income
|
(9.5
|
)
|
|
—
|
|
|
(5.6
|
)
|
|
15.1
|
|
|
—
|
|
|||||
Interest expense
|
16.3
|
|
|
13.4
|
|
|
0.4
|
|
|
(15.1
|
)
|
|
15.0
|
|
|||||
Income from continuing operations before income taxes
|
122.1
|
|
|
208.0
|
|
|
22.2
|
|
|
(135.7
|
)
|
|
216.6
|
|
|||||
Income tax expense (benefit) from continuing operations
|
(2.5
|
)
|
|
72.5
|
|
|
8.0
|
|
|
—
|
|
|
78.0
|
|
|||||
Income from continuing operations
|
124.6
|
|
|
135.5
|
|
|
14.2
|
|
|
(135.7
|
)
|
|
138.6
|
|
|||||
Loss from discontinued operations, net of tax
|
—
|
|
|
(14.3
|
)
|
|
—
|
|
|
—
|
|
|
(14.3
|
)
|
|||||
Net income
|
$
|
124.6
|
|
|
$
|
121.2
|
|
|
$
|
14.2
|
|
|
$
|
(135.7
|
)
|
|
$
|
124.3
|
|
Net loss attributable to noncontrolling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
0.3
|
|
|
0.3
|
|
|||||
Net income attributable to controlling interest
|
$
|
124.6
|
|
|
$
|
121.2
|
|
|
$
|
14.2
|
|
|
$
|
(135.4
|
)
|
|
$
|
124.6
|
|
|
Parent
|
|
Subsidiary
Guarantors
|
|
Non-
Guarantors
|
|
Eliminations/
Consolidations
|
|
Consolidated
|
||||||||||
Net sales
|
$
|
—
|
|
|
$
|
1,000.1
|
|
|
$
|
241.2
|
|
|
$
|
—
|
|
|
$
|
1,241.3
|
|
Cost of sales
|
—
|
|
|
637.9
|
|
|
171.8
|
|
|
—
|
|
|
809.7
|
|
|||||
Cost of sales—impairment, restructuring and other
|
—
|
|
|
—
|
|
|
0.2
|
|
|
—
|
|
|
0.2
|
|
|||||
Gross profit
|
—
|
|
|
362.2
|
|
|
69.2
|
|
|
—
|
|
|
431.4
|
|
|||||
Operating expenses:
|
|
|
|
|
|
|
|
|
|
||||||||||
Selling, general and administrative
|
—
|
|
|
226.6
|
|
|
66.7
|
|
|
0.9
|
|
|
294.2
|
|
|||||
Impairment, restructuring and other
|
—
|
|
|
9.9
|
|
|
3.2
|
|
|
—
|
|
|
13.1
|
|
|||||
Other (income) loss, net
|
—
|
|
|
(0.9
|
)
|
|
0.3
|
|
|
—
|
|
|
(0.6
|
)
|
|||||
Income (loss) from operations
|
—
|
|
|
126.6
|
|
|
(1.0
|
)
|
|
(0.9
|
)
|
|
124.7
|
|
|||||
Equity income in subsidiaries
|
(58.6
|
)
|
|
(2.1
|
)
|
|
—
|
|
|
60.7
|
|
|
—
|
|
|||||
Other non-operating income
|
(14.0
|
)
|
|
—
|
|
|
(11.2
|
)
|
|
25.2
|
|
|
—
|
|
|||||
Interest expense
|
27.5
|
|
|
21.7
|
|
|
0.7
|
|
|
(25.2
|
)
|
|
24.7
|
|
|||||
Income from continuing operations before income taxes
|
45.1
|
|
|
107.0
|
|
|
9.5
|
|
|
(61.6
|
)
|
|
100.0
|
|
|||||
Income tax expense (benefit) from continuing operations
|
(4.9
|
)
|
|
37.5
|
|
|
3.4
|
|
|
—
|
|
|
36.0
|
|
|||||
Income from continuing operations
|
50.0
|
|
|
69.5
|
|
|
6.1
|
|
|
(61.6
|
)
|
|
64.0
|
|
|||||
Loss from discontinued operations, net of tax
|
—
|
|
|
(13.7
|
)
|
|
—
|
|
|
—
|
|
|
(13.7
|
)
|
|||||
Net income
|
$
|
50.0
|
|
|
$
|
55.8
|
|
|
$
|
6.1
|
|
|
$
|
(61.6
|
)
|
|
$
|
50.3
|
|
Net income attributable to noncontrolling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
(0.3
|
)
|
|
(0.3
|
)
|
|||||
Net income attributable to controlling interest
|
$
|
50.0
|
|
|
$
|
55.8
|
|
|
$
|
6.1
|
|
|
$
|
(61.9
|
)
|
|
$
|
50.0
|
|
|
Parent
|
|
Subsidiary
Guarantors
|
|
Non-
Guarantors
|
|
Eliminations/
Consolidations
|
|
Consolidated
|
||||||||||
Net income
|
$
|
124.6
|
|
|
$
|
121.2
|
|
|
$
|
14.2
|
|
|
$
|
(135.7
|
)
|
|
$
|
124.3
|
|
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net foreign currency translation adjustment
|
(8.1
|
)
|
|
—
|
|
|
(8.1
|
)
|
|
8.1
|
|
|
(8.1
|
)
|
|||||
Net change in derivatives
|
(1.6
|
)
|
|
(1.1
|
)
|
|
—
|
|
|
1.1
|
|
|
(1.6
|
)
|
|||||
Net change in pension and other post-retirement benefits
|
0.8
|
|
|
0.5
|
|
|
0.3
|
|
|
(0.8
|
)
|
|
0.8
|
|
|||||
Total other comprehensive income (loss)
|
(8.9
|
)
|
|
(0.6
|
)
|
|
(7.8
|
)
|
|
8.4
|
|
|
(8.9
|
)
|
|||||
Comprehensive income
|
$
|
115.7
|
|
|
$
|
120.6
|
|
|
$
|
6.4
|
|
|
$
|
(127.3
|
)
|
|
$
|
115.4
|
|
|
Parent
|
|
Subsidiary
Guarantors
|
|
Non-
Guarantors
|
|
Eliminations/
Consolidations
|
|
Consolidated
|
||||||||||
Net income
|
$
|
50.0
|
|
|
$
|
55.8
|
|
|
$
|
6.1
|
|
|
$
|
(61.6
|
)
|
|
$
|
50.3
|
|
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
|
|
|
|
||||||||||
Net foreign currency translation adjustment
|
(11.1
|
)
|
|
—
|
|
|
(11.1
|
)
|
|
11.1
|
|
|
(11.1
|
)
|
|||||
Net change in derivatives
|
(1.7
|
)
|
|
(0.5
|
)
|
|
—
|
|
|
0.5
|
|
|
(1.7
|
)
|
|||||
Net change in pension and other post-retirement benefits
|
1.6
|
|
|
1.0
|
|
|
0.6
|
|
|
(1.6
|
)
|
|
1.6
|
|
|||||
Total other comprehensive income (loss)
|
(11.2
|
)
|
|
0.5
|
|
|
(10.5
|
)
|
|
10.0
|
|
|
(11.2
|
)
|
|||||
Comprehensive income (loss)
|
$
|
38.8
|
|
|
$
|
56.3
|
|
|
$
|
(4.4
|
)
|
|
$
|
(51.6
|
)
|
|
$
|
39.1
|
|
|
Parent
|
|
Subsidiary
Guarantors
|
|
Non-
Guarantors
|
|
Eliminations/
Consolidations
|
|
Consolidated
|
||||||||||
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES
(a)
|
$
|
48.7
|
|
|
$
|
(432.4
|
)
|
|
$
|
(99.9
|
)
|
|
$
|
(165.1
|
)
|
|
$
|
(648.7
|
)
|
|
|
|
|
|
|
|
|
|
|
||||||||||
INVESTING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
||||||||||
Proceeds from sale of long-lived assets
|
—
|
|
|
5.2
|
|
|
—
|
|
|
—
|
|
|
5.2
|
|
|||||
Investments in property, plant and equipment
|
—
|
|
|
(25.2
|
)
|
|
(2.8
|
)
|
|
—
|
|
|
(28.0
|
)
|
|||||
Investments in acquired businesses, net of cash acquired
|
—
|
|
|
(50.5
|
)
|
|
—
|
|
|
—
|
|
|
(50.5
|
)
|
|||||
Net cash used in investing activities
|
—
|
|
|
(70.5
|
)
|
|
(2.8
|
)
|
|
—
|
|
|
(73.3
|
)
|
|||||
|
|
|
|
|
|
|
|
|
|
||||||||||
FINANCING ACTIVITIES
|
|
|
|
|
|
|
|
|
|
||||||||||
Borrowings under revolving and bank lines of credit and term loans
|
—
|
|
|
1,034.5
|
|
|
161.0
|
|
|
—
|
|
|
1,195.5
|
|
|||||
Repayments under revolving and bank lines of credit and term loans
|
—
|
|
|
(388.7
|
)
|
|
(61.8
|
)
|
|
—
|
|
|
(450.5
|
)
|
|||||
Dividends paid
|
(54.8
|
)
|
|
(76.3
|
)
|
|
(3.7
|
)
|
|
80.0
|
|
|
(54.8
|
)
|
|||||
Purchase of Common Shares
|
(14.8
|
)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(14.8
|
)
|
|||||
Payment on seller notes
|
—
|
|
|
(0.8
|
)
|
|
—
|
|
|
—
|
|
|
(0.8
|
)
|
|||||
Excess tax benefits from share-based payment arrangements
|
—
|
|
|
2.8
|
|
|
—
|
|
|
—
|
|
|
2.8
|
|
|||||
Cash received from the exercise of stock options
|
16.2
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
16.2
|
|
|||||
Financing cash flows from (to) affiliates
|
4.7
|
|
|
(87.6
|
)
|
|
(2.2
|
)
|
|
85.1
|
|
|
—
|
|
|||||
Net cash provided by (used in) financing activities
|
(48.7
|
)
|
|
483.9
|
|
|
93.3
|
|
|
165.1
|
|
|
693.6
|
|
|||||
Effect of exchange rate changes on cash
|
—
|
|
|
—
|
|
|
(6.1
|
)
|
|
—
|
|
|
(6.1
|
)
|
|||||
Net increase (decrease) in cash and cash equivalents
|
—
|
|
|
(19.0
|
)
|
|
(15.5
|
)
|
|
—
|
|
|
(34.5
|
)
|
|||||
Cash and cash equivalents at beginning of period
|
—
|
|
|
23.1
|
|
|
66.2
|
|
|
—
|
|
|
89.3
|
|
|||||
Cash and cash equivalents at end of period
|
$
|
—
|
|
|
$
|
4.1
|
|
|
$
|
50.7
|
|
|
$
|
—
|
|
|
$
|
54.8
|
|
(a)
|
Cash received by the Parent from its subsidiaries in the form of dividends in the amount of
$76.3 million
represent return on investments and are included in cash flows from operating activities. Cash received by the Guarantors from the Non-Guarantors in the form of dividends in the amount of
$3.7 million
represent return on investments and are included in the cash flows from operating activities.
|
|
Parent
|
|
Subsidiary
Guarantors
|
|
Non-
Guarantors
|
|
Eliminations/
Consolidations
|
|
Consolidated
|
||||||||||
ASSETS
|
|||||||||||||||||||
Current assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
—
|
|
|
$
|
4.1
|
|
|
$
|
50.7
|
|
|
$
|
—
|
|
|
$
|
54.8
|
|
Accounts receivable, net
|
—
|
|
|
441.8
|
|
|
226.8
|
|
|
—
|
|
|
668.6
|
|
|||||
Accounts receivable pledged
|
—
|
|
|
376.7
|
|
|
—
|
|
|
—
|
|
|
376.7
|
|
|||||
Inventories
|
—
|
|
|
460.3
|
|
|
123.8
|
|
|
—
|
|
|
584.1
|
|
|||||
Assets held for sale
|
—
|
|
|
205.3
|
|
|
—
|
|
|
—
|
|
|
205.3
|
|
|||||
Prepaid and other current assets
|
—
|
|
|
107.6
|
|
|
38.5
|
|
|
—
|
|
|
146.1
|
|
|||||
Total current assets
|
—
|
|
|
1,595.8
|
|
|
439.8
|
|
|
—
|
|
|
2,035.6
|
|
|||||
Property, plant and equipment, net
|
—
|
|
|
370.3
|
|
|
56.9
|
|
|
—
|
|
|
427.2
|
|
|||||
Goodwill
|
—
|
|
|
204.4
|
|
|
7.1
|
|
|
11.6
|
|
|
223.1
|
|
|||||
Intangible assets, net
|
—
|
|
|
249.0
|
|
|
36.9
|
|
|
12.6
|
|
|
298.5
|
|
|||||
Other assets
|
18.0
|
|
|
12.7
|
|
|
20.5
|
|
|
(25.8
|
)
|
|
25.4
|
|
|||||
Equity investment in subsidiaries
|
387.3
|
|
|
—
|
|
|
—
|
|
|
(387.3
|
)
|
|
—
|
|
|||||
Intercompany assets
|
1,370.5
|
|
|
—
|
|
|
—
|
|
|
(1,370.5
|
)
|
|
—
|
|
|||||
Total assets
|
$
|
1,775.8
|
|
|
$
|
2,432.2
|
|
|
$
|
561.2
|
|
|
$
|
(1,759.4
|
)
|
|
$
|
3,009.8
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|||||||||||||||||||
Current liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Current portion of debt
|
$
|
—
|
|
|
$
|
302.2
|
|
|
$
|
13.1
|
|
|
$
|
—
|
|
|
$
|
315.3
|
|
Accounts payable
|
—
|
|
|
223.4
|
|
|
71.1
|
|
|
—
|
|
|
294.5
|
|
|||||
Liabilities held for sale
|
—
|
|
|
56.6
|
|
|
—
|
|
|
—
|
|
|
56.6
|
|
|||||
Other current liabilities
|
16.0
|
|
|
225.3
|
|
|
82.9
|
|
|
—
|
|
|
324.2
|
|
|||||
Total current liabilities
|
16.0
|
|
|
807.5
|
|
|
167.1
|
|
|
—
|
|
|
990.6
|
|
|||||
Long-term debt
|
1,198.9
|
|
|
906.8
|
|
|
100.7
|
|
|
(998.9
|
)
|
|
1,207.5
|
|
|||||
Other liabilities
|
4.8
|
|
|
224.9
|
|
|
32.8
|
|
|
(20.7
|
)
|
|
241.8
|
|
|||||
Equity investment in subsidiaries
|
—
|
|
|
114.6
|
|
|
—
|
|
|
(114.6
|
)
|
|
—
|
|
|||||
Intercompany liabilities
|
—
|
|
|
248.8
|
|
|
104.1
|
|
|
(352.9
|
)
|
|
—
|
|
|||||
Total liabilities
|
1,219.7
|
|
|
2,302.6
|
|
|
404.7
|
|
|
(1,487.1
|
)
|
|
2,439.9
|
|
|||||
Total shareholders’ equity - controlling interest
|
556.1
|
|
|
129.6
|
|
|
156.5
|
|
|
(286.1
|
)
|
|
556.1
|
|
|||||
Noncontrolling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
13.8
|
|
|
13.8
|
|
|||||
Total equity
|
556.1
|
|
|
129.6
|
|
|
156.5
|
|
|
(272.3
|
)
|
|
569.9
|
|
|||||
Total liabilities and equity
|
$
|
1,775.8
|
|
|
$
|
2,432.2
|
|
|
$
|
561.2
|
|
|
$
|
(1,759.4
|
)
|
|
$
|
3,009.8
|
|
|
Parent
|
|
Subsidiary
Guarantors
|
|
Non-
Guarantors
|
|
Eliminations/
Consolidations
|
|
Consolidated
|
||||||||||
ASSETS
|
|||||||||||||||||||
Current assets:
|
|
|
|
|
|
|
|
|
|
||||||||||
Cash and cash equivalents
|
$
|
—
|
|
|
$
|
8.2
|
|
|
$
|
63.2
|
|
|
$
|
—
|
|
|
$
|
71.4
|
|
Accounts receivable, net
|
—
|
|
|
63.3
|
|
|
94.4
|
|
|
—
|
|
|
157.7
|
|
|||||
Accounts receivable pledged
|
—
|
|
|
152.9
|
|
|
—
|
|
|
—
|
|
|
152.9
|
|
|||||
Inventories
|
—
|
|
|
306.9
|
|
|
88.9
|
|
|
—
|
|
|
395.8
|
|
|||||
Assets held for sale
|
—
|
|
|
220.3
|
|
|
—
|
|
|
—
|
|
|
220.3
|
|
|||||
Prepaid and other current assets
|
—
|
|
|
86.4
|
|
|
34.7
|
|
|
—
|
|
|
121.1
|
|
|||||
Total current assets
|
—
|
|
|
838.0
|
|
|
281.2
|
|
|
—
|
|
|
1,119.2
|
|
|||||
Property, plant and equipment, net
|
—
|
|
|
388.0
|
|
|
56.1
|
|
|
—
|
|
|
444.1
|
|
|||||
Goodwill
|
—
|
|
|
260.2
|
|
|
12.0
|
|
|
11.6
|
|
|
283.8
|
|
|||||
Intangible assets, net
|
—
|
|
|
608.6
|
|
|
34.8
|
|
|
11.7
|
|
|
655.1
|
|
|||||
Other assets
|
16.3
|
|
|
11.0
|
|
|
15.0
|
|
|
(17.3
|
)
|
|
25.0
|
|
|||||
Equity investment in subsidiaries
|
461.3
|
|
|
—
|
|
|
—
|
|
|
(461.3
|
)
|
|
—
|
|
|||||
Intercompany assets
|
1,179.4
|
|
|
—
|
|
|
—
|
|
|
(1,179.4
|
)
|
|
—
|
|
|||||
Total assets
|
$
|
1,657.0
|
|
|
$
|
2,105.8
|
|
|
$
|
399.1
|
|
|
$
|
(1,634.7
|
)
|
|
$
|
2,527.2
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
LIABILITIES AND SHAREHOLDERS’ EQUITY
|
|||||||||||||||||||
Current liabilities:
|
|
|
|
|
|
|
|
|
|
||||||||||
Current portion of debt
|
$
|
—
|
|
|
$
|
122.9
|
|
|
$
|
9.7
|
|
|
$
|
—
|
|
|
$
|
132.6
|
|
Accounts payable
|
—
|
|
|
136.7
|
|
|
56.4
|
|
|
—
|
|
|
193.1
|
|
|||||
Liabilities held for sale
|
—
|
|
|
41.7
|
|
|
—
|
|
|
—
|
|
|
41.7
|
|
|||||
Other current liabilities
|
15.5
|
|
|
162.7
|
|
|
73.0
|
|
|
—
|
|
|
251.2
|
|
|||||
Total current liabilities
|
15.5
|
|
|
464.0
|
|
|
139.1
|
|
|
—
|
|
|
618.6
|
|
|||||
Long-term debt
|
1,016.3
|
|
|
724.9
|
|
|
100.1
|
|
|
(816.3
|
)
|
|
1,025.0
|
|
|||||
Other liabilities
|
4.5
|
|
|
226.0
|
|
|
32.3
|
|
|
(12.3
|
)
|
|
250.5
|
|
|||||
Equity investment in subsidiaries
|
—
|
|
|
156.2
|
|
|
—
|
|
|
(156.2
|
)
|
|
—
|
|
|||||
Intercompany liabilities
|
—
|
|
|
296.5
|
|
|
47.6
|
|
|
(344.1
|
)
|
|
—
|
|
|||||
Total liabilities
|
1,036.3
|
|
|
1,867.6
|
|
|
319.1
|
|
|
(1,328.9
|
)
|
|
1,894.1
|
|
|||||
Total shareholders’ equity - controlling interest
|
620.7
|
|
|
238.2
|
|
|
80.0
|
|
|
(318.2
|
)
|
|
620.7
|
|
|||||
Noncontrolling interest
|
—
|
|
|
—
|
|
|
—
|
|
|
12.4
|
|
|
12.4
|
|
|||||
Total equity
|
620.7
|
|
|
238.2
|
|
|
80.0
|
|
|
(305.8
|
)
|
|
633.1
|
|
|||||
Total liabilities and equity
|
$
|
1,657.0
|
|
|
$
|
2,105.8
|
|
|
$
|
399.1
|
|
|
$
|
(1,634.7
|
)
|
|
$
|
2,527.2
|
|
•
|
Executive summary
|
•
|
Results of operations
|
•
|
Segment results
|
•
|
Liquidity and capital resources
|
•
|
Regulatory matters
|
•
|
Critical accounting policies and estimates
|
|
THREE MONTHS ENDED
|
|
SIX MONTHS ENDED
|
||||||||
|
APRIL 2, 2016
|
|
MARCH 28, 2015
|
|
APRIL 2, 2016
|
|
MARCH 28, 2015
|
||||
Net sales
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
|
100.0
|
%
|
Cost of sales
|
58.1
|
|
|
60.4
|
|
|
62.3
|
|
|
65.2
|
|
Cost of sales—impairment, restructuring and other
|
—
|
|
|
—
|
|
|
0.3
|
|
|
—
|
|
Gross profit
|
41.9
|
|
|
39.6
|
|
|
37.4
|
|
|
34.8
|
|
Operating expenses:
|
|
|
|
|
|
|
|
||||
Selling, general and administrative
|
16.2
|
|
|
17.6
|
|
|
21.8
|
|
|
23.7
|
|
Impairment, restructuring and other
|
(3.8
|
)
|
|
0.4
|
|
|
(3.2
|
)
|
|
1.1
|
|
Other income, net
|
(0.1
|
)
|
|
—
|
|
|
(0.1
|
)
|
|
—
|
|
Income from operations
|
29.6
|
|
|
21.6
|
|
|
18.9
|
|
|
10.0
|
|
Costs related to refinancing
|
—
|
|
|
—
|
|
|
0.6
|
|
|
—
|
|
Interest expense
|
1.5
|
|
|
1.4
|
|
|
2.5
|
|
|
1.9
|
|
Income from continuing operations before income taxes
|
28.1
|
|
|
20.2
|
|
|
15.8
|
|
|
8.1
|
|
Income tax expense from continuing operations
|
10.0
|
|
|
7.3
|
|
|
5.6
|
|
|
2.9
|
|
Income from continuing operations
|
18.1
|
|
|
12.9
|
|
|
10.2
|
|
|
5.2
|
|
Loss from discontinued operations, net of tax
|
(1.3
|
)
|
|
(1.3
|
)
|
|
(1.2
|
)
|
|
(1.1
|
)
|
Net income
|
16.8
|
%
|
|
11.6
|
%
|
|
9.0
|
%
|
|
4.1
|
%
|
|
THREE MONTHS ENDED
|
|
SIX MONTHS ENDED
|
||
|
APRIL 2, 2016
|
|
APRIL 2, 2016
|
||
Volume
|
15.8
|
|
|
15.0
|
|
Acquisitions
|
1.6
|
|
|
2.6
|
|
Foreign exchange rates
|
(0.6
|
)
|
|
(1.1
|
)
|
Pricing
|
(0.6
|
)
|
|
(0.5
|
)
|
Change in net sales
|
16.2
|
%
|
|
16.0
|
%
|
•
|
increased sales in our U.S. Consumer, Europe Consumer and Other segments, driven by the impact of the calendar shift whereby our second quarter of fiscal 2016 ended six days later than our second quarter of fiscal 2015 and these six days were in our peak selling season, resulting in an increase in net sales of approximately $103 million and $120 million for the
three
and six months ended
April 2, 2016
;
|
•
|
increased sales volume in our U.S. Consumer, Europe Consumer and Other segments, driven by increased sales of fertilizer, seed, controls and growing media products, and the impact of our amended Marketing Agreement for consumer Roundup
®
; and
|
•
|
the addition of net sales from acquisitions within our Other segment, primarily from General Hydroponics and Vermicrop;
|
•
|
partially offset by the unfavorable impact of foreign exchange rates as a result of the strengthening of the U.S. dollar relative to other currencies including the Canadian dollar, euro and British pound; and
|
•
|
an unfavorable impact of decreased pricing, largely from higher performance based trade programs, in the U.S. Consumer, Europe Consumer and Other segments.
|
|
THREE MONTHS ENDED
|
|
SIX MONTHS ENDED
|
||||||||||||
|
APRIL 2, 2016
|
|
MARCH 28, 2015
|
|
APRIL 2, 2016
|
|
MARCH 28, 2015
|
||||||||
|
(In millions)
|
||||||||||||||
Materials
|
$
|
436.3
|
|
|
$
|
387.7
|
|
|
$
|
515.0
|
|
|
$
|
461.5
|
|
Distribution and warehousing
|
126.5
|
|
|
118.4
|
|
|
172.7
|
|
|
167.0
|
|
||||
Manufacturing labor and overhead
|
137.9
|
|
|
122.5
|
|
|
171.7
|
|
|
145.7
|
|
||||
Roundup
®
reimbursements
|
22.8
|
|
|
18.2
|
|
|
36.9
|
|
|
35.5
|
|
||||
|
723.5
|
|
|
646.8
|
|
|
896.3
|
|
|
809.7
|
|
||||
Impairment, restructuring and other
|
0.1
|
|
|
0.2
|
|
|
5.1
|
|
|
0.2
|
|
||||
|
$
|
723.6
|
|
|
$
|
647.0
|
|
|
$
|
901.4
|
|
|
$
|
809.9
|
|
|
THREE MONTHS ENDED
|
|
SIX MONTHS ENDED
|
||||
|
APRIL 2, 2016
|
|
APRIL 2, 2016
|
||||
|
(In millions)
|
||||||
Volume and product mix
|
$
|
90.4
|
|
|
$
|
110.3
|
|
Roundup
®
reimbursements
|
4.6
|
|
|
1.4
|
|
||
Material costs
|
(11.4
|
)
|
|
(11.2
|
)
|
||
Foreign exchange rates
|
(6.9
|
)
|
|
(13.9
|
)
|
||
|
76.7
|
|
|
86.6
|
|
||
Impairment, restructuring and other
|
(0.1
|
)
|
|
4.9
|
|
||
Change in cost of sales
|
$
|
76.6
|
|
|
$
|
91.5
|
|
•
|
costs related to increased sales volume in our U.S. Consumer, Europe Consumer and Other segments;
|
•
|
costs related to sales from acquisitions within our Other segment of $10.4 million and $20.0 million for the
three
and six months ended
April 2, 2016
, respectively, primarily from General Hydroponics and Vermicrop; and
|
•
|
an increase in net sales attributable to reimbursements under our Marketing Agreement for consumer Roundup
®
;
|
•
|
partially offset by lower material costs in our U.S. Consumer segment driven by lower commodity costs;
|
•
|
lower distribution costs within our U.S. Consumer segment due to savings from fuel purchases and the recognition of lower negative mark-to-market adjustments associated with our fuel hedges of $2.6 million and $8.2 million for the
three
and six months ended
April 2, 2016
;
|
•
|
the favorable impact of foreign exchange rates as a result of a strengthening of the U.S. dollar relative to other currencies including the Canadian dollar, euro and British pound; and
|
•
|
the decrease in restructuring and other charges of
$0.1 million
for the
three months ended
April 2, 2016
and the increase in restructuring and other charges of
$4.9 million
for the
six months ended
April 2, 2016
, both related to addressing the consumer complaints regarding our reformulated Bonus S
®
product sold during fiscal 2015.
|
|
THREE MONTHS ENDED
|
|
SIX MONTHS ENDED
|
||
|
APRIL 2, 2016
|
|
APRIL 2, 2016
|
||
Product mix and volume:
|
|
|
|
||
Mix and volume
|
0.8
|
%
|
|
1.4
|
%
|
Roundup
®
commissions and reimbursements
|
0.9
|
|
|
1.0
|
|
Material costs
|
0.9
|
|
|
0.8
|
|
Pricing
|
(0.3
|
)
|
|
(0.2
|
)
|
|
2.3
|
%
|
|
3.0
|
%
|
Impairment, restructuring and other
|
—
|
|
|
(0.4
|
)
|
Change in gross profit rate
|
2.3
|
%
|
|
2.6
|
%
|
•
|
increased net sales volume driving improved leverage of fixed costs such as warehousing;
|
•
|
lower distribution costs within our U.S. Consumer segment due to savings from fuel purchases and the recognition of lower negative mark-to-market adjustments associated with our fuel hedges of $2.6 million and $8.2 million for the
three
and six months ended
April 2, 2016
;
|
•
|
lower material costs in our U.S. Consumer segment driven by commodities; and
|
•
|
an increase in net sales attributable to our Marketing Agreement for consumer Roundup
®
;
|
•
|
partially offset by unfavorable product mix within our U.S. Consumer and Other segments due to increased sales of mulch products; and
|
•
|
an unfavorable impact of decreased pricing, largely from higher performance based trade programs, in the U.S. Consumer, Europe Consumer and Other segments.
|
|
THREE MONTHS ENDED
|
|
SIX MONTHS ENDED
|
||||||||||||
|
APRIL 2, 2016
|
|
MARCH 28, 2015
|
|
APRIL 2, 2016
|
|
MARCH 28, 2015
|
||||||||
|
(In millions)
|
||||||||||||||
Advertising
|
$
|
61.2
|
|
|
$
|
61.3
|
|
|
$
|
72.1
|
|
|
$
|
70.0
|
|
Research and development
|
9.9
|
|
|
10.2
|
|
|
20.9
|
|
|
19.8
|
|
||||
Share-based compensation
|
9.1
|
|
|
7.2
|
|
|
11.3
|
|
|
9.3
|
|
||||
Amortization of intangibles
|
3.7
|
|
|
2.6
|
|
|
7.1
|
|
|
5.5
|
|
||||
Other selling, general and administrative
|
117.0
|
|
|
107.6
|
|
|
202.8
|
|
|
189.6
|
|
||||
|
$
|
200.9
|
|
|
$
|
188.9
|
|
|
$
|
314.2
|
|
|
$
|
294.2
|
|
|
THREE MONTHS ENDED
|
|
SIX MONTHS ENDED
|
||||||||||||
|
APRIL 2, 2016
|
|
MARCH 28, 2015
|
|
APRIL 2, 2016
|
|
MARCH 28, 2015
|
||||||||
|
(In millions)
|
||||||||||||||
U.S. Consumer
|
$
|
1,039.7
|
|
|
$
|
893.2
|
|
|
$
|
1,152.9
|
|
|
$
|
990.4
|
|
Europe Consumer
|
115.0
|
|
|
118.1
|
|
|
140.7
|
|
|
150.6
|
|
||||
Other
|
90.5
|
|
|
60.5
|
|
|
146.1
|
|
|
100.3
|
|
||||
Consolidated
|
$
|
1,245.2
|
|
|
$
|
1,071.8
|
|
|
$
|
1,439.7
|
|
|
$
|
1,241.3
|
|
|
THREE MONTHS ENDED
|
|
SIX MONTHS ENDED
|
||||||||||||
|
APRIL 2, 2016
|
|
MARCH 28, 2015
|
|
APRIL 2, 2016
|
|
MARCH 28, 2015
|
||||||||
|
(In millions)
|
||||||||||||||
U.S. Consumer
|
$
|
336.0
|
|
|
$
|
250.6
|
|
|
$
|
281.8
|
|
|
$
|
192.0
|
|
Europe Consumer
|
21.6
|
|
|
20.7
|
|
|
12.4
|
|
|
8.9
|
|
||||
Other
|
4.6
|
|
|
0.9
|
|
|
5.1
|
|
|
(2.5
|
)
|
||||
Segment Total
|
362.2
|
|
|
272.2
|
|
|
299.3
|
|
|
198.4
|
|
||||
Corporate
|
(35.7
|
)
|
|
(32.7
|
)
|
|
(60.1
|
)
|
|
(53.9
|
)
|
||||
Intangible asset amortization
|
(4.3
|
)
|
|
(3.1
|
)
|
|
(8.2
|
)
|
|
(6.5
|
)
|
||||
Impairment, restructuring and other
|
47.0
|
|
|
(4.8
|
)
|
|
40.5
|
|
|
(13.3
|
)
|
||||
Costs related to refinancing
|
—
|
|
|
—
|
|
|
(8.8
|
)
|
|
—
|
|
||||
Interest expense
|
(19.1
|
)
|
|
(15.0
|
)
|
|
(35.4
|
)
|
|
(24.7
|
)
|
||||
Consolidated
|
$
|
350.1
|
|
|
$
|
216.6
|
|
|
$
|
227.3
|
|
|
$
|
100.0
|
|
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)
|
||||||
January 3 through January 30
|
241,985
|
|
|
$
|
64.15
|
|
|
240,500
|
|
|
$
|
469,759,550
|
|
January 31 through February 27
|
233,080
|
|
|
$
|
65.64
|
|
|
231,700
|
|
|
$
|
454,556,113
|
|
February 28 through April 2
|
175,197
|
|
|
$
|
70.95
|
|
|
171,500
|
|
|
$
|
442,394,885
|
|
Total
|
650,262
|
|
|
$
|
66.52
|
|
|
643,700
|
|
|
|
(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 6,563 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)
|
On August 11, 2014, Scotts Miracle-Gro announced that its Board of Directors authorized the repurchase of up to $500 million of Common Shares over a five-year period (starting November 1, 2014 through September 30, 2019). The dollar amounts in the “Approximate Dollar Value of Common Shares That May Yet be Purchased Under the Plans or Programs” column reflect the remaining amounts that were available for repurchase under the $500 million authorized repurchase program.
|
|
|
|
|
|
THE SCOTTS MIRACLE-GRO COMPANY
|
|
|
|
Date: May 11, 2016
|
|
/s/ THOMAS RANDAL COLEMAN
|
|
|
Printed Name: Thomas Randal Coleman
|
|
|
Title: Executive Vice President and Chief Financial Officer
|
EXHIBIT
NO.
|
|
DESCRIPTION
|
|
LOCATION
|
|
|
|
|
|
10.1
|
|
Amendment No. 1, dated as of February 8, 2016, to Fourth Amended and Restated Credit Agreement dated October 29, 2015, by and among The Scotts Miracle-Gro Company, as a Borrower; the Subsidiary Borrowers (as defined therein); JPMorgan Chase Bank, N.A., as Administrative Agent; Bank of America, N.A. and Wells Fargo Bank, National Association, as Co-Syndication Agents; CoBank, ACB, Mizuho Bank, LTD., Coöperatieve Rabobank U.S., New York Branch (formerly known as Coöperatieve Centrale Raiffeisen-Boerenleenbank B.A. “Rabobank Nederland”, New
York Branch), TD Bank N.A. and U.S. Bank National Association, as Co-Documentation Agents; and the several other banks and other financial institutions from
time to time parties thereto
|
|
Incorporated herein by reference to the Registrant’s Quarterly Report on Form 10-Q for the quarterly period ended January 2, 2016 filed February 11, 2016 [Exhibit 10.3]
|
|
|
|
|
|
10.2
|
|
Incentive Compensation/Retention Award Agreement, dated February 11, 2016, between The Scotts Miracle-Gro Company and Michael C. Lukemire
|
|
*
|
|
|
|
|
|
10.3
|
|
Consulting Agreement, dated February 12, 2016, between The Scotts Company LLC and Hanft Projects LLC
|
|
*
|
|
|
|
|
|
10.4
|
|
Form of Aircraft Time Sharing Agreement for Executive Officers
|
|
*
|
|
|
|
|
|
10.5
|
|
Waiver and First Amendment to Amended and Restated Master Accounts Receivable Purchase Agreement, dated as of March 23, 2016, among The Scotts Miracle-Gro Company, The Scotts Company LLC, the Banks party thereto and Mizuho Bank, Ltd., as Administrative Agent
|
|
Incorporated herein by reference to the Registrant’s Current Report on Form 8-K filed March 29, 2016
[Exhibit 10.1]
|
|
|
|
|
|
21
|
|
Subsidiaries of The Scotts Miracle-Gro Company
|
|
*
|
|
|
|
|
|
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
|
1.
|
Incentive Compensation/Retention Bonus
.
|
a.
|
Amount.
Subject to the terms of this Agreement, you may be eligible to receive a one-time, discretionary incentive compensation/retention award in an amount equal to $500,000 (the “Incentive Compensation/Retention Bonus”).
|
b.
|
Conditions to Receipt of Incentive Compensation/Retention Bonus
. You must satisfy both of the following personal performance and retention criteria in order to be eligible to receive the Incentive Compensation/Retention Bonus:
|
i.
|
Satisfaction of Personal Performance Criteria
. You must satisfy personal performance criteria identified and communicated by the CEO, the satisfaction of which shall be determined in the CEO’s sole discretion.
|
ii.
|
Employment
. You must remain continuously employed by the Company from the date of this Agreement through February 11, 2018 (the “Retention Date”).
|
c.
|
Timing
. Subject to your satisfaction of the criteria set forth in Section 1(b) above, you shall receive your Incentive Compensation/Retention Bonus within thirty (30) days of the Retention Date.
|
d.
|
Nature of Incentive Compensation/Retention Bonus
. The parties agree that the Incentive Compensation/Retention Bonus that is paid under this Agreement shall be exceptional and nonrecurring in nature and, as a result, shall not be considered incentive eligible earnings or otherwise a salary component paid to you on a regular basis. Eligibility to receive the Incentive Compensation/Retention Bonus has no impact on your eligibility to receive an annual incentive bonus under any applicable annual incentive plans of the Company.
|
2.
|
Covenants
. Any pay and benefits that you are entitled to receive under this Agreement are conditioned on you continuing to abide by all existing covenants you have with the Company.
|
3.
|
Withholding Taxes
. The Company shall have the power and the right to deduct or withhold, or require you to remit to the Company, an amount sufficient to satisfy federal, state, and local taxes, domestic or foreign, required by law or regulation to be withheld with respect to any taxable event arising as a result of this Agreement.
|
4.
|
Enforceability and Successors
. This Agreement shall inure to the benefit of and be binding upon the Company, but in no circumstances shall this Agreement be construed to entitle you to duplicate benefits set forth in this Agreement.
|
5.
|
No Obligation to Employ
. Nothing in this Agreement will confer on you any right to continue to serve as an employee of, or to continue in any other relationship with, the Company, or limit in any way the right of the Company to terminate your employment or other relationship at any time.
|
6.
|
Prior Agreements
. You and the Company acknowledge that this Agreement contains all of the terms and conditions with respect to the subject matter hereof, specifically the Incentive Compensation/Retention Bonus, and supersedes all previous or contemporaneous agreements, understandings, representations, or proposals (whether formal or informal, written or oral) relating to the subject matter hereof. This Agreement does not modify any other obligations on you to the Company, including but not limited to any obligations related to noncompetition, nonsolicitation or confidentiality.
|
7.
|
Internal Revenue Code (“Code”) Section 409A Provisions
. This Agreement shall be interpreted in accordance with Code Section 409A and the guidance issued thereunder, including any exceptions to Code Section 409A. This Agreement shall be deemed to be modified to the maximum extent necessary to be in compliance with Code Section 409A’s rules or applicable exceptions.
|
8.
|
Modifications
. No modification or amendment of this Agreement shall be effective unless in writing and duly executed by all the parties hereto, except that the Company may unilaterally amend this Agreement to the extent necessary to avoid any adverse tax or accounting consequences.
|
10.
|
Acknowledgments
. You acknowledge that you have received legal assistance or have declined to receive legal assistance after the Company has advised you to obtain legal assistance regarding the contents and execution of this Agreement, you acknowledge that you had a chance to ask questions about this Agreement and you acknowledge that you are fully aware of any and all employment and/or tax law related consequences of any payment made to you under this Agreement.
|
11.
|
Interpretations
. All determinations and decisions made by the Company, the CEO, or any delegate of the Company or the CEO as to the provisions of this Agreement shall be conclusive, final, and binding on all parties.
|
12.
|
Method of Acceptance
. This Agreement may be executed in multiple counterparts, each of which shall constitute an original, and all of which shall constitute a single Agreement. To accept, you must sign and date the original Agreement. This Agreement will not be effective or enforceable until the date a signed copy of the Agreement is received by the Company at the above address.
|
|
Very truly yours,
The Scotts Miracle-Gro Company
By: __
/s/ DENISE STUMP
_________________
Denise Stump
Executive Vice President, Global Human Resources
|
Approved and Agreed:
_
/s/ MICHAEL C. LUKEMIRE
__________
Michael C. Lukemire
|
___
3/7/16
__________________
Date
|
I.
|
Scope of Services
|
1.
|
Contractor agrees to provide consulting services to Scotts in the area of Marketing so as to advise the Company on marketing strategies concerning a variety of areas including, but not limited to, brand and creative efforts, partnerships with outside services, work processes and staffing/personnel assessments.
|
2.
|
In providing consulting services in the Areas of Expertise, it is anticipated that Contractor will generally undertake the following work and activities pursuant to this Agreement:
|
•
|
Provide insights and expertise to help inspire and develop a culture of creativity, with emphasis on: Shaping and assisting with the development of the overall marketing and creative strategy in conjunction with the CEO and COO; inspiring innovation; building Scotts’ brands and consumer loyalty; and mentoring and coaching key marketing and business executives as requested.
|
•
|
Consult with and provide recommendations to the CEO and COO on an as needed basis on issues of marketing strategy.
|
•
|
Periodically participate in marketing meetings to support the successful execution of the anticipated marketing initiatives of the Company with specific emphasis on the Connected Yard, Lawns campaign and other special projects.
|
•
|
Participate in discussions of and otherwise support other marketing issues as required.
|
3.
|
In providing consulting services to Scotts under this Agreement, Contractor will be an independent contractor and will not be an employee, agent, partner, or joint venturer of Scotts or of any of Scotts’ affiliates, or of any of its or their respective officers, directors or employees. Except as provided as a member of the Board, if applicable, and except as otherwise expressly stated herein including in paragraph 1(b), Mr. Hanft and any other designee or employee of Contractor will not participate in or receive benefits under any of Scotts’ employee fringe benefit programs or receive any other fringe benefits from Scotts, including, without limitation, the health, disability, life insurance, retirement, equity awards, pension and profit sharing benefits on account of the consulting services provided to Scotts under this Agreement.
|
II.
|
Length of Agreement
|
III.
|
Authority
|
IV.
|
Consulting Fees and Expenses
|
1.
|
In exchange for providing the consulting services hereunder, during the term of this Agreement, Scotts shall pay Contractor a consulting fee consisting of a combination of cash and restricted stock units, as follows:
|
a.
|
A monthly cash payment of $75,000 for each month during the term irrespective of whether Scotts requests that Contractor provides consulting services hereunder. Contractor shall be required to submit monthly invoices including days/hours worked with brief descriptions of the services provided. Scotts shall pay Contractor within 30 days of its receipt of Contractor’s invoices.
|
b.
|
Subject to Contractor providing consulting services required by this Agreement throughout the complete term of this Agreement, the Company will provide Contractor a one-time grant of grant of restricted stock units (“RSUs”) with a grant date value of $400,000. The RSUs’ shall be issued in the name of Adam Hanft individually. The number of RSUs will be determined by dividing the intended grant date value by the closing price of a share on the grant date, rounded up to the next whole share. Except where Scotts terminates this Agreement without Cause, the RSUs and any related dividend equivalents will vest on January 31, 2017, provided that this Agreement has not otherwise been terminated or notified for termination on that date, and provided that Contractor has fulfilled Contractor’s full service obligation to Scotts under the terms of this letter agreement at that time. In the event that Scotts terminates this Agreement without Cause, then the RSUs shall vest on a pro rata basis determined by dividing the
|
i.
|
With the exception of the vesting provisions described above, the award of RSUs and related dividend equivalents shall be subject to the terms of The Scotts Miracle-Gro Company Long Term Incentive Plan, effective as of January 17, 2013 (the “Plan”), and the standard terms and conditions of the applicable award agreement. In the event of any conflicts or ambiguity between this Agreement and the terms of the Plan and/or the award agreement, the Plan and/or award agreement will be controlling.
|
2.
|
Scotts also will pay or reimburse Contractor for all reasonable expenses incurred by Contractor in connection with providing consulting services to Scotts as contemplated herein, including, without limitation, all reasonable (a) telephone and fax expenses, and (b) travel expenses, including, without limitation, transportation, food and lodging, incurred in connection with attending Scotts approved meetings pursuant to this consulting agreement. Contractor must incur and account for expenses in accordance with the policies and procedures established by Scotts as a precondition to Scotts’ obligation to pay or reimburse Contractor for such expenses pursuant to the terms of the preceding sentence. This includes describing expenses in reasonable detail on invoices. Scotts will provide private transportation when practical and economically reasonable.
|
3.
|
Contractor agrees to provide, at its own expense, all equipment necessary to provide the consulting services contemplated herein and to be responsible for its own overhead costs and expenses except for those expenses that Scotts has expressly agreed to pay pursuant to the terms of the preceding paragraph.
|
V.
|
Termination
|
1.
|
Scotts shall be permitted to terminate this Agreement and its consulting relationship with Contractor under any of the following circumstances: (a) upon Scotts’ 60 days advance written notice to Contractor, (b) Mr. Hanft’s death or disability, or Contractor ceasing operations, (c) Contractor’s material breach of its obligations to Scotts if such breach is not cured within 30 days after receiving notice thereof, (d) Contractor’s and/or Mr. Hanft’s indictment for a felony or serious misdemeanor, (e) Contractor’s and/or Mr. Hanft’s commission of an act of fraud or bad faith toward Scotts, or (f) Contractor’s and/or Mr. Hanft’s misappropriation of any funds, property or rights of Scotts. Contractor shall be permitted to terminate this Agreement and its consulting relationship with Scotts upon Contractor’s 30 day advance written notice to Scotts.
|
2.
|
The termination of this Agreement and Contractor’s consulting relationship with Scotts shall not affect Scotts’ obligation to pay Contractor for the amounts Contractor has earned prior to the date of such termination or reimburse Contractor for the expenses Contractor has incurred pursuant to the terms of this Agreement prior to the date of such termination.
|
VI.
|
Confidential Information
|
1.
|
In providing the consulting services contemplated herein, Contractor will receive Confidential Information about Scotts and its affiliates. Maintaining the confidential nature of this information is very important to Scotts. As used in this Agreement, “Confidential Information” is any information about Scotts, or its affiliates, to which Contractor gains access in connection with its provision of consulting or other services to Scotts, including Mr. Hanft’s service as a member of the Board. Confidential Information does not include information Contractor can show (a) was already in Contractor’s possession prior to the time Contractor received such information as a consultant to Scotts, or (b) is publicly available or otherwise in the public domain by means other than Contractor’s violation of the terms of this Agreement.
|
2.
|
Contractor agrees to not at any time hereafter, without the prior written consent of Scotts, disclose, directly or indirectly, any Confidential Information or use any Confidential Information for any purpose other than providing consulting services to Scotts as contemplated herein.
|
3.
|
Contractor agrees to promptly return to Scotts, upon Scotts’ request, all electronic or tangible documents that contain any Confidential Information and to retain no copies.
|
4.
|
These confidentiality obligations are in addition to, and not in place of, any and all confidentiality obligations arising as a result of Mr. Hanft’s membership on the Board and applicable Board Committees.
|
VII.
|
Other
|
1.
|
Contractor understands and agrees that this Agreement does not obligate Scotts to utilize Contractor’s consulting services, but it is intended to set forth the terms pursuant to which Scotts may utilize Contractor’s consulting services in Scotts’ discretion.
|
2.
|
Contractor is not permitted to assign, sell or otherwise transfer any of its rights or obligations hereunder.
|
3.
|
Contractor acknowledges that neither Scotts nor any representatives of Scotts have made any representations or promises about the tax implications of this Agreement. Nothing in this Agreement may be construed as tax advice from Scotts to Contractor. Contractor has been encouraged to discuss the tax implications of this Agreement with his own tax and financial counsel.
|
|
THE SCOTTS COMPANY LLC
By: _
/s/ DENISE STUMP
__________________
Denise Stump
EVP, Global Human Resources & Chief Ethics Officer
|
ACKNOWLEDGED AND AGREED:
__
/s/ ADAM HANFT
____________________
Adam Hanft, Chief Executive Officer
Hanft Projects LLC
|
|
The Scotts Company LLC
14111 Scottslawn Road
Marysville, Ohio 43041
By:
Name:
Title:
|
USER:
___________________________________
[EXECUTIVE OFFICER NAME]
|
OPERATOR:
The Scotts Company LLC, an Ohio
Limited Liability Company
By:
__________________________________
Name:
________________________________
Title:
_________________________________
|
NAME
|
|
JURISDICTION OF FORMATION
|
|
|
|
EG Systems, Inc.
1
|
|
Indiana
|
SLS Franchise Systems LLC
1
|
|
Delaware
|
GenSource, Inc.
|
|
Ohio
|
Gutwein & Co., Inc.
|
|
Indiana
|
OMS Investments, Inc.
|
|
Delaware
|
Scotts Temecula Operations, LLC
|
|
Delaware
|
Sanford Scientific, Inc.
|
|
New York
|
Scotts Global Investments, Inc.
|
|
Delaware
|
Scotts Global Services, Inc.
|
|
Ohio
|
Scotts Luxembourg SARL
|
|
Luxembourg
|
Scotts Manufacturing Company
|
|
Delaware
|
Miracle-Gro Lawn Products, Inc.
|
|
New York
|
Scotts Products Co.
|
|
Ohio
|
Scotts Servicios, S.A. de C.V.
2
|
|
Mexico
|
Scotts Professional Products Co.
|
|
Ohio
|
Scotts Servicios, S.A. de C.V.
2
|
|
Mexico
|
SMG Growing Media, Inc.
|
|
Ohio
|
AeroGrow International, Inc.
3
|
|
Nevada
|
Hyponex Corporation
|
|
Delaware
|
Rod McLellan Company
|
|
California
|
The Hawthorne Gardening Company
|
|
Delaware
|
Hawthorne Hydroponics LLC
|
|
Delaware
|
HGCI, Inc.
|
|
Nevada
|
SMGM LLC
|
|
Ohio
|
Scotts-Sierra Investments LLC
|
|
Delaware
|
ASEF BV
|
|
Netherlands
|
Scotts Asia, Limited
|
|
Hong Kong
|
Scotts Australia Pty Limited
|
|
Australia
|
Scotts Gardening Fertilizer (Wuhan) Co., Ltd.
|
|
China
|
Scotts Benelux BVBA
4
|
|
Belgium
|
Scotts Canada Ltd.
|
|
Canada
|
Scotts Czech s.r.o.
|
|
Czech Republic
|
Scotts de Mexico SA de CV
5
|
|
Mexico
|
________________________
|
1
Effective April 13, 2016, contributed to a joint venture with TruGreen Holding Corporation.
2
Scotts Professional Products Co. owns 50% and Scotts Products Co. owns 50%.
3
SMG Growing Media, Inc.’s ownership is 39.2%.
4
OMS Investments, Inc. owns 0.1% and Scotts-Sierra Investments LLC owns the remaining 99.9%.
5
The Scotts Company LLC owns 0.5% and Scotts-Sierra Investments LLC owns the remaining 99.5%.
|
Scotts France Holdings SARL
|
|
France
|
Scotts France SAS
|
|
France
|
Scotts Celaflor GmbH
|
|
Germany
|
Scotts Celaflor HGmbH
|
|
Austria
|
Scotts Holdings Limited
|
|
United Kingdom
|
Levington Group Limited
|
|
United Kingdom
|
The Scotts Company (UK) Limited
|
|
United Kingdom
|
The Scotts Company (Manufacturing) Limited
|
|
United Kingdom
|
Humax Horticulture Limited
|
|
United Kingdom
|
O M Scott International Investments Limited
|
|
United Kingdom
|
Scotts Poland Sp.z.o.o.
|
|
Poland
|
Teak 2, Ltd.
|
|
Delaware
|
Turf-Seed (Europe) Limited
|
|
Ireland
|
Swiss Farms Products, Inc.
|
|
Delaware
|
The Scotts Company LLC
|
|
Ohio
|
iConservo Incorporated
6
|
|
California
|
|
|
|
________________________
|
6
The Scotts Company LLC’s ownership is 20%.
|
1.
|
I have reviewed this Quarterly Report on Form 10-Q of The Scotts Miracle-Gro Company for the fiscal quarter ended
April 2, 2016
;
|
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)
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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
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5.
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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):
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(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
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(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.
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Date: May 11, 2016
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By:
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/s/ JAMES HAGEDORN
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Printed Name: James Hagedorn
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Title: Chief Executive Officer and Chairman of the Board
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1.
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I have reviewed this Quarterly Report on Form 10-Q of The Scotts Miracle-Gro Company for the fiscal quarter ended
April 2, 2016
;
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2.
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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;
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3.
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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;
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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;
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(b)
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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;
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(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
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(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: May 11, 2016
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|
By:
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/s/ THOMAS RANDAL COLEMAN
|
|
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Printed Name: Thomas Randal Coleman
|
|
|
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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.
|
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/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
|
|
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May 11, 2016
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May 11, 2016
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*
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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.
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