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SEGMENT INFORMATION | 9 Months Ended
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Jul. 03, 2022
Segment Reporting [Abstract] |
SEGMENT INFORMATION | SEGMENT INFORMATION Net sales relating to the segments for the three and nine month periods ended July 3, 2022 and July 4, 2021 are as follows:
|  | Three Month Periods Ended |  | Nine Month Periods Ended
(in millions) |  | July 3, 2022 |  | July 4, 2021 |  | July 3, 2022 |  | July 4, 2021
HPC |  | $ | 329.3 |  |  | $ | 274.4 |  |  | 1,025.2 |  |  | 950.8 |
GPC |  | 290.2 |  |  | 257.3 |  |  | 887.5 |  |  | 826.3 |
H&G |  | 198.5 |  |  | 212.1 |  |  | 470.3 |  |  | 463.2 |
Net sales |  | $ | 818.0 |  |  | $ | 743.8 |  |  | $ | 2,383.0 |  |  | $ | 2,240.3 |
The Chief Operating Decision Maker of the Company uses Adjusted EBITDA as the primary operating metric in evaluating the business and making operating decisions. EBITDA is calculated by excluding the Company’s income tax expense, interest expense, depreciation expense and amortization expense (from intangible assets) from net income. Adjusted EBITDA further excludes: •Stock based compensation costs consist of costs associated with long-term incentive compensation arrangements that generally consist of non-cash, stock-based compensation. During the nine month period ended July 4, 2021, compensation costs included incentive bridge awards previously issued due to changes in the Company’s LTIP that allowed for cash based payment upon employee election but do not qualify for shared-based compensation, which were fully vested in November 2020. See Note 14 – Share Based Compensation for further details; •Incremental amounts attributable to strategic transactions and business development initiatives including, but not limited to, the acquisition or divestitures of a business, costs to effect and facilitate a transaction, including such cost to integrate or separate the respective business. These amounts are excluded from our performance metrics as they are reflective of incremental investment by the Company towards business development activities, incremental costs attributable to such transactions and are not considered recurring or reflective of the continuing ongoing operations of the consolidated group or segments; •Incremental amounts realized towards restructuring and optimization projects including, but not limited to, costs towards the development and implementation of strategies to optimize operations and improve efficiency, reduce costs, increase revenues, increase or maintain our current profit margins, including recognition of one-time exit or disposal costs. These amounts are excluded from our ongoing performance metrics as they are reflective of incremental investment by the Company towards significant initiatives controlled by management, incremental costs directly attributable to such initiatives, indirect impact or disruption to operating performance during implementation, and are not considered recurring or reflective of the continuing ongoing operations of the consolidated group or segments; •Unallocated shared costs associated with discontinued operations from certain shared and center-led administrative functions the Company's business units excluded from income from discontinued operations as they are not a direct cost of the discontinued business but a result of indirect allocations, including but not limited to, information technology, human resources, finance and accounting, supply chain, and commercial operations. Amounts attributable to unallocated shared costs would be mitigated through subsequent strategic or restructuring initiatives, TSAs, elimination of extraneous costs, or re-allocations or absorption of existing continuing operations following the completed sale of the discontinued operations. See Note 2 – Divestitures for further details; •Non-cash purchase accounting adjustments recognized in earnings from continuing operations subsequent to an acquisition, including, but not limited to, the costs attributable to the step-up in inventory value, and the incremental value in operating lease assets with below market rent, among others; •Non-cash gain from the reduction in the contingent consideration liability recognized during the three and nine month periods ended July 3, 2022 associated with the Tristar Business acquisition. See Note 3 - Acquisitions in the Notes to the Condensed Consolidated Financial Statements for further details; •Non-cash asset impairments or write-offs realized and recognized in earnings from continuing operations; •Gains attributable to the Company's investment in Energizer common stock during the nine month period ended July 4, 2021, with such remaining shares sold in January 2021. See Note 12 – Fair Value of Financial Instruments for further details; •Incremental reserves for non-recurring litigation or environmental remediation activity including the proposed settlement on outstanding litigation matters at our H&G division attributable to significant and unusual nonrecurring claims with no previous history or precedent recognized during the nine month period ended July 4, 2021 and the subsequent remeasurement during the nine month period ended July 3, 2022; •Proforma adjustment for operating losses of the Company's in-country Russia operations that were directly attributable to the Company's closing initiatives in Russia and constraints applied to the in-country commercial operations resulting in a substantial decrease to in-country sales and incremental operating losses being realized; •Realized gain from early settlement on certain cash flow hedges in our EMEA region prior to their stated maturity during the three and nine month periods ended July 3, 2022 due to change in the Company's legal entity organizational structure and forecasted purchasing strategy of HPC finished goods inventory within the region. See Note 11- Derivatives in Notes to the Condensed Consolidated Financial Statement for further details; •Other adjustments are primarily attributable to: (1) costs associated with Salus as they are not considered a component of the continuing commercial products company and (2) other key executive severance related costs. Segment Adjusted EBITDA for the reportable segments for SBH for the three and nine month periods ended July 3, 2022 and July 4, 2021, are as follows:
|  | Three Month Periods Ended |  | Nine Month Periods Ended
SBH (in millions) |  | July 3, 2022 |  | July 4, 2021 |  | July 3, 2022 |  | July 4, 2021
HPC |  | $ | 3.6 |  |  | $ | 11.8 |  |  | 41.6 |  |  | 88.1 |
GPC |  | 40.9 |  |  | 49.2 |  |  | 120.2 |  |  | 158.5 |
H&G |  | 42.8 |  |  | 53.4 |  |  | 73.1 |  |  | 98.6 |
Total Segment Adjusted EBITDA |  | 87.3 |  |  | 114.4 |  |  | 234.9 |  |  | 345.2 |
Corporate |  | 7.2 |  |  | 15.0 |  |  | 26.5 |  |  | 32.4 |
Interest expense |  | 26.0 |  |  | 20.4 |  |  | 72.4 |  |  | 96.4 |
Depreciation |  | 12.3 |  |  | 12.8 |  |  | 36.6 |  |  | 39.2 |
Amortization |  | 13.1 |  |  | 17.4 |  |  | 39.9 |  |  | 48.2 |
Share and incentive based compensation |  | (0.7) |  |  | 7.7 |  |  | 11.4 |  |  | 21.9 |
Tristar acquisition and integration |  | 5.6 |  |  | — |  |  | 20.0 |  |  | — |
Rejuvenate acquisition and integration |  | — |  |  | 5.8 |  |  | 7.0 |  |  | 5.8 |
Armitage acquisition and integration |  | 0.1 |  |  | 1.0 |  |  | 1.4 |  |  | 7.7 |
Omega integration |  | 0.1 |  |  | — |  |  | 1.5 |  |  | — |
HHI divestiture |  | 0.6 |  |  | — |  |  | 6.1 |  |  | — |
HPC separation initiatives |  | 10.7 |  |  | (0.5) |  |  | 15.4 |  |  | 14.2 |
Coevorden operations separation |  | 1.9 |  |  | 2.9 |  |  | 7.3 |  |  | 7.7 |
Fiscal 2022 restructuring |  | 8.1 |  |  | — |  |  | 8.1 |  |  | — |
Global ERP transformation |  | 3.4 |  |  | 0.9 |  |  | 9.4 |  |  | 1.6 |
GPC distribution center transition |  | 8.4 |  |  | 7.7 |  |  | 28.3 |  |  | 7.7 |
Global productivity improvement program |  | 1.2 |  |  | 4.8 |  |  | 5.2 |  |  | 15.7 |
HPC brand portfolio transitions |  | 0.3 |  |  | — |  |  | 0.3 |  |  | — |
Russia closing initiatives |  | — |  |  | — |  |  | 3.6 |  |  | — |
Other project costs |  | 4.1 |  |  | 2.4 |  |  | 10.7 |  |  | 8.1 |
Unallocated shared costs |  | 7.0 |  |  | 6.7 |  |  | 20.7 |  |  | 20.2 |
Non-cash purchase accounting adjustments |  | 4.3 |  |  | 1.3 |  |  | 7.8 |  |  | 4.7 |
Gain from contingent consideration liability |  | (25.0) |  |  | — |  |  | (25.0) |  |  | — |
Gain on Energizer investment |  | — |  |  | — |  |  | — |  |  | (6.9) |
Legal and environmental remediation reserves |  | — |  |  | — |  |  | (0.5) |  |  | 6.0 |
Proforma in-country Russia operations |  | 0.4 |  |  | — |  |  | 0.4 |  |  | — |
Gain on early settlement of cash flow hedges |  | (8.2) |  |  | — |  |  | (8.2) |  |  | — |
Salus and other |  | 1.4 |  |  | — |  |  | 1.7 |  |  | 0.1 |
Income (loss) from continuing operations before income taxes |  | $ | 5.0 |  |  | $ | 8.1 |  |  | $ | (73.1) |  |  | $ | 14.5 |
Segment Adjusted EBITDA for reportable segments for SB/RH for the three and nine month periods ended July 3, 2022 and July 4, 2021 are as follows:
|  | Three Month Periods Ended |  | Nine Month Periods Ended
SB/RH (in millions) |  | July 3, 2022 |  | July 4, 2021 |  | July 3, 2022 |  | July 4, 2021
HPC |  | $ | 3.6 |  |  | $ | 11.8 |  |  | 41.6 |  |  | 88.1 |
GPC |  | 40.9 |  |  | 49.2 |  |  | 120.2 |  |  | 158.5 |
H&G |  | 42.8 |  |  | 53.4 |  |  | 73.1 |  |  | 98.6 |
Total Segment Adjusted EBITDA |  | 87.3 |  |  | 114.4 |  |  | 234.9 |  |  | 345.2 |
Corporate |  | 6.7 |  |  | 14.0 |  |  | 25.5 |  |  | 30.8 |
Interest expense |  | 26.1 |  |  | 20.5 |  |  | 72.7 |  |  | 96.6 |
Depreciation |  | 12.3 |  |  | 12.8 |  |  | 36.6 |  |  | 39.2 |
Amortization |  | 13.1 |  |  | 17.4 |  |  | 39.9 |  |  | 48.2 |
Share and incentive based compensation |  | (1.1) |  |  | 7.1 |  |  | 10.7 |  |  | 20.7 |
Tristar acquisition and integration |  | 5.6 |  |  | — |  |  | 20.0 |  |  | — |
Rejuvenate acquisition and integration |  | — |  |  | 5.8 |  |  | 7.0 |  |  | 5.8 |
Armitage acquisition and integration |  | 0.1 |  |  | 1.0 |  |  | 1.4 |  |  | 7.7 |
Omega integration |  | 0.1 |  |  | — |  |  | 1.5 |  |  | — |
HHI divestiture |  | 0.6 |  |  | — |  |  | 6.1 |  |  | — |
HPC separation initiatives |  | 10.7 |  |  | (0.5) |  |  | 15.4 |  |  | 14.2 |
Coevorden operations separation |  | 1.9 |  |  | 2.9 |  |  | 7.3 |  |  | 7.7 |
Fiscal 2022 restructuring |  | 8.1 |  |  | — |  |  | 8.1 |  |  | — |
Global ERP transformation |  | 3.4 |  |  | 0.9 |  |  | 9.4 |  |  | 1.6 |
GPC distribution center transition |  | 8.4 |  |  | 7.7 |  |  | 28.3 |  |  | 7.7 |
Global productivity improvement program |  | 1.2 |  |  | 4.8 |  |  | 5.2 |  |  | 15.7 |
HPC brand portfolio transitions |  | 0.3 |  |  | — |  |  | 0.3 |  |  | — |
Russia in-country closing initiatives |  | — |  |  | — |  |  | 3.6 |  |  | — |
Other project costs |  | 4.1 |  |  | 2.4 |  |  | 10.7 |  |  | 8.1 |
Unallocated shared costs |  | 7.0 |  |  | 6.7 |  |  | 20.7 |  |  | 20.2 |
Non-cash purchase accounting adjustments |  | 4.3 |  |  | 1.3 |  |  | 7.8 |  |  | 4.7 |
Gain from contingent consideration liability |  | (25.0) |  |  | — |  |  | (25.0) |  |  | — |
Gain on Energizer investment |  | — |  |  | — |  |  | — |  |  | (6.9) |
Legal and environmental remediation reserves |  | — |  |  | — |  |  | (0.5) |  |  | 6.0 |
Proforma in-country Russia operations |  | 0.4 |  |  | — |  |  | 0.4 |  |  | — |
Gain on early settlement of cash flow hedges |  | (8.2) |  |  | — |  |  | (8.2) |  |  | — |
Other |  | 1.5 |  |  | — |  |  | 1.4 |  |  | 0.1 |
Income (loss) from continuing operations before income taxes |  | $ | 5.7 |  |  | $ | 9.6 |  |  | $ | (71.4) |  |  | $ | 17.1 |

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- Definition The entire disclosure for reporting segments including data and tables. Reportable segments include those that meet any of the following quantitative thresholds a) it's reported revenue, including sales to external customers and intersegment sales or transfers is 10 percent or more of the combined revenue, internal and external, of all operating segments b) the absolute amount of its reported profit or loss is 10 percent or more of the greater, in absolute amount of 1) the combined reported profit of all operating segments that did not report a loss or 2) the combined reported loss of all operating segments that did report a loss c) its assets are 10 percent or more of the combined assets of all operating segments. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 31 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8924-108599 Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 34 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8981-108599 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (a) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8721-108599 Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 40 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e9031-108599 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (f) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8933-108599 Reference 6: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (e) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8933-108599 Reference 7: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 26 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8844-108599 Reference 8: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 41 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e9038-108599 Reference 9: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 32 -Subparagraph (d) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8933-108599 Reference 10: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 22 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8736-108599 Reference 11: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 42 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e9054-108599 Reference 12: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 15 -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8657-108599 Reference 13: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -SubTopic 10 -Section 50 -Paragraph 21 -Subparagraph (b) -URI https://asc.fasb.org/extlink&oid=126901519&loc=d3e8721-108599 Reference 14: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 280 -URI https://asc.fasb.org/topic&trid=2134510 + Details
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