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Segment and Geographic Data
 12 Months Ended
Sep. 30, 2012
Segment and Geographic Data

(27) Segment and Geographic Data

Segment information for the periods presented is as follows:

 

     Year Ended September 30,  
     2012     2011     2010  

Revenues:

       

Consumer products

    $ 3,252,435      $ 3,186,916      $ 2,567,011   

Insurance

      1,221,724        290,866        —     

Other financial services

      8,694        —          —     

Intersegment elimination

      (2,137 )      —          —     
  

 

 

    

 

 

    

 

 

  

Consolidated revenues

    $ 4,480,716      $ 3,477,782      $ 2,567,011   
  

 

 

    

 

 

    

 

 

  

Depreciation and amortization:

       

Consumer products

    $ 133,780      $ 135,149      $ 117,418   

Insurance

      163,665        (9,430 )      —     

Other financial services

      55        —          —     
  

 

 

    

 

 

    

 

 

  

Total segments

      297,500        125,719        117,418   

Corporate depreciation and amortization

      2,020        207        53   
  

 

 

    

 

 

    

 

 

  

Consolidated depreciation and amortization

    $ 299,520      $ 125,926      $ 117,471   
  

 

 

    

 

 

    

 

 

  

Operating income (loss):

       

Consumer products

    $ 301,746      $ 227,944      $ 168,778   

Insurance

      163,783        (18,041 )      —     

Other financial services

      2,645        —          —     

Intersegment elimination

      (2,137 )      —          —     
  

 

 

    

 

 

    

 

 

  

Total segments

      466,037        209,903        168,778   

Corporate expenses (a)

      (56,546 )      (46,217 )      (8,324 ) 
  

 

 

    

 

 

    

 

 

  

Consolidated operating income

      409,491        163,686        160,454   

Interest expense

      (251,032 )      (249,260 )      (277,015 ) 

(Increase) decrease in fair value of equity conversion feature of preferred stock

      (156,600 )      27,910        —     

Bargain purchase gain from business acquisition

      —          158,341        —     

Gain on contingent purchase price reduction

      41,000        —          —     

Other expense, net

      (17,473 )      (42,743 )      (12,105 ) 

Reorganization items expense

      —          —          (3,646 ) 
  

 

 

    

 

 

    

 

 

  

Consolidated income (loss) from continuing operations before income taxes

    $ 25,386      $ 57,934      $ (132,312 ) 
  

 

 

    

 

 

    

 

 

  

Capital expenditures:

       

Consumer products

    $ 46,809      $ 36,160      $ 40,316   

Insurance

      6,209        1,745        —     

Other financial services

      474        —          —     
  

 

 

    

 

 

    

 

 

  

Total segments

      53,492        37,905        40,316   

Corporate capital expenditures

      26        345        58   
  

 

 

    

 

 

    

 

 

  

Consolidated capital expenditures

    $ 53,518      $ 38,250      $ 40,374   
  

 

 

    

 

 

    

 

 

  

 

     September 30,  
     2012     2011  

Total assets:

     

Consumer products

    $ 3,751,649      $ 3,626,706   

Insurance

      20,905,830        19,347,961   

Other financial services

      195,057        —     

Intersegment elimination

      (182,069 )      —     
  

 

 

    

 

 

  

Total segments

      24,670,467        22,974,667   

Corporate assets

      530,024        616,221   
  

 

 

    

 

 

  

Consolidated total assets

    $ 25,200,491      $ 23,590,888   
  

 

 

    

 

 

  

 

     September 30,  
     2012      2011  

Total long-lived assets (b):

      

Consumer products

    $ 2,690,222       $ 2,578,418   

Insurance

      280,434         460,694   

Other financial services

      449         —     
  

 

 

     

 

 

  

Total segments

      2,971,105         3,039,112   

Corporate long-lived assets

      15,412         19,952   
  

 

 

     

 

 

  

Consolidated long-lived assets

    $ 2,986,517       $ 3,059,064   
  

 

 

     

 

 

  

 

(a)

Included in corporate expenses are $3,770, $26,996 and $6,649 related to business acquisitions and other projects and $3,282, $4,359 and $212 related to Front Street for Fiscal 2012, 2011 and 2010, respectively.
(b)

Total long-lived assets include all non-current assets of the Consumer Products and Other section of the Consolidated Balance Sheet and properties (included in “Other assets”) and intangibles of the Insurance and Financial Services section.

The Company’s geographic data disclosures are as follows:

Net sales to external customers:

 

     Year Ended September 30,  
     2012      2011      2010  

United States

    $ 1,772,138       $ 1,780,127       $ 1,444,779   

Outside the United States

      1,480,297         1,406,789         1,122,232   
  

 

 

     

 

 

     

 

 

  

Consolidated net sales to external customers

    $ 3,252,435       $ 3,186,916       $ 2,567,011   
  

 

 

     

 

 

     

 

 

  

Long-lived assets:

 

     September 30,  
     2012      2011  

United States

    $ 2,284,927       $ 2,324,515   

Outside the United States

      701,590         734,549   
  

 

 

     

 

 

  

Consolidated long-lived assets

    $ 2,986,517       $ 3,059,064   
  

 

 

     

 

 

  

 

Venezuela Hyperinflation

Spectrum Brands does business in Venezuela through a Venezuelan subsidiary. At January 4, 2010, the beginning of the second quarter of Fiscal 2010, Spectrum Brands determined that Venezuela met the definition of a highly inflationary economy under US GAAP. As a result, beginning January 4, 2010, the U.S. dollar is the functional currency for Spectrum Brands’ Venezuelan subsidiary. Accordingly, subsequent to January 4, 2010, currency remeasurement adjustments for this subsidiary’s financial statements and other transactional foreign exchange gains and losses are reflected in earnings. Through January 3, 2010, prior to being designated as highly inflationary, translation adjustments related to the Venezuelan subsidiary were reflected as a component of AOCI.

In addition, on January 8, 2010, the Venezuelan government announced its intention to devalue its currency, the Bolivar fuerte, relative to the U.S. dollar. As a result, Spectrum Brands remeasured the local balance sheet of its Venezuela entity during the second quarter of Fiscal 2010 to reflect the impact of the devaluation to the official exchange rate of 4.3 Bolivian fuerte per U.S. dollar. Based on actual exchange activity as of September 30, 2010, Spectrum Brands determined that the most likely method of exchanging its Bolivar fuertes for U.S. dollars would be to formally apply with the Venezuelan government to exchange through commercial banks at the Transaction System for Foreign Currency Denominated Securities (“SITME”) rate specified by the Central Bank of Venezuela. The SITME rate as of September 30, 2010 was quoted at 5.3 Bolivar fuerte per U.S. dollar. Therefore, Spectrum Brands changed the rate used to remeasure Bolivar fuerte denominated transactions as of September 30, 2010 from the official exchange rate to the 5.3 SITME rate in accordance with ASC Topic 830, “Foreign Currency Matters,” (“ASC 830”) as it was the expected rate that exchanges of Bolivar fuerte to U.S. dollars would be settled.

The designation of the Spectrum Brands’ Venezuela entity as a highly inflationary economy and the devaluation of the Bolivar fuerte resulted in a $1,486 reduction to the Company’s operating income during Fiscal 2010. The Company also reported a foreign exchange loss in “Other expense, net” of $10,102 during Fiscal 2010.

As of September 30, 2011, Spectrum Brands is no longer exchanging its Bolivar Fuertes for U.S. dollars through the SITME mechanism and the SITME is no longer the most likely method of exchanging its Bolivar fuertes for U.S. dollars. Therefore, Spectrum Brands changed the rate used to remeasure Bolivar fuerte denominated transactions as of September 30, 2011 from the 5.3 SITME rate to the 4.3 official exchange rate in accordance with ASC 830 as it is the expected rate that exchanges of Bolivar fuerte to U.S. dollars will be settled. Spectrum Brands reported a foreign exchange gain in “Other expense, net” of $1,293 during Fiscal 2011 related to the change to the official exchange rate.