RYE, N.Y., July 29 NY-Jarden-2Q08-earns
RYE, N.Y., July 29 /PRNewswire-FirstCall/ -- Jarden Corporation
(NYSE: JAH) today reported its financial results for the three and six months
ended June 30, 2008.
For the three months ended June 30, 2008, net sales increased 30% to $1.4
billion compared to $1.1 billion for the same period in the previous year. For
the three months ended June 30, 2008, net income was $43.0 million, or $0.56
per diluted share, compared to net income of $16.7 million, or $0.23 per
diluted share, in the three months ended June 30, 2007. On a non-GAAP basis,
adjusted net income was $54.8 million, or $0.72 per diluted share, for the
three months ended June 30, 2008, compared to $44.5 million, or $0.62 per
diluted share, for the three months ended June 30, 2007.
For the six months ended June 30, 2008, net sales increased 38% to $2.6
billion compared to $1.9 billion for the same period in the previous year.
For the six months ended June 30, 2008, net income was $47.7 million, or $0.62
per diluted share, compared to net income of $18.1 million, or $0.25 per
diluted share, in the six months ended June 30, 2007. On a non-GAAP basis,
adjusted net income was $71.3 million, or $0.93 per diluted share, for the six
months ended June 30, 2008, compared to $61.6 million, or $0.87 per diluted
share, for the six months ended June 30, 2007.
The Pure Fishing, Inc. and K2 Inc. businesses have been included in the
results of operations from their dates of acquisition in April 2007 and August
2007, respectively. Please see the schedule accompanying this release for a
reconciliation of GAAP to non-GAAP net income and diluted earnings per share.
"Jarden posted an outstanding second quarter in a difficult macro economic
environment," said Martin E. Franklin, Chairman and Chief Executive Officer of
Jarden Corporation. "By any key measure, whether organic sales growth, gross
margin expansion, free cash flow, working capital improvements, liquidity and
positive momentum, we achieved our macro goals. It was particularly satisfying
to deliver organic sales growth in each of our primary business segments and
we anticipate continuing to grow sales organically in the second half of 2008.
The defensive nature of our diversified business model is proving that market
leading brands coupled with innovative, value driven products can win even in
this very tough economy."
Mr. Franklin continued, "We are focused on continuing to execute well in
the back half of the year, without cutting back on our investment spend on new
product development and marketing that will help drive our success in future
years. While we are not immune to the significant headwinds of rising costs
and consumer softness affecting many companies in the consumer space, our goal
is to take full advantage of the current turmoil to consolidate our leadership
positions in the niche markets we serve and reinforce the relevancy of our
brands and products to our customers."
The Company will be holding a conference call at 9:45 a.m. EDT today, July
29, 2008, to further discuss its results and respond to questions. The call
will be accessible via a webcast through the Company's website at
www.jarden.com and will be archived online until August 12, 2008.
Jarden Corporation is a leading provider of niche consumer products.
Jarden operates in three primary business segments through a number of well
recognized brands, including: Outdoor Solutions: Abu Garcia(R), Berkley(R),
Campingaz(R) and Coleman(R), Fenwick(R), Gulp!(R), JT(R), K2(R), Marker(R),
Marmot(R), Mitchell(R), Penn(R), Rawlings(R), Shakespeare(R), Stearns(R),
Stren(R), Trilene(R), and Volkl(R); Consumer Solutions: Bionaire(R), Crock-
Pot(R), FoodSaver(R), Health o meter(R), Holmes(R), Mr. Coffee(R), Oster(R),
Patton(R), Rival(R), Seal-a-Meal(R), Sunbeam(R), VillaWare(R) and White
Mountain(R); and Branded Consumables: Ball(R), Bee(R), Bicycle(R),
Crawford(R), Diamond(R), Dicon(R), First Alert(R), Forster(R), Hoyle(R),
Kerr(R), Lehigh(R), Leslie-Locke(R), Loew Cornell(R) and Pine Mountain(R).
Headquartered in Rye, N.Y., Jarden has over 25,000 employees worldwide. For
more information, please visit www.jarden.com.
Note: This news release contains "forward-looking statements" within the
meaning of the federal securities laws and is intended to qualify for the Safe
Harbor from liability established by the Private Securities Litigation Reform
Act of 1995, including statements regarding the Company's adjusted earnings
per share, repurchase of shares of common stock from time to time under the
Company's stock repurchase program, the outlook for Jarden's markets and the
demand for its products, estimated sales, segment earnings, earnings per
share, cash flows from operations, future revenues and margin requirement and
expansion, organic growth, the success of new product introductions, growth
in costs and expenses and the impact of acquisitions, divestitures,
restructurings, and other unusual items, including Jarden's ability to
integrate and obtain the anticipated results and synergies from its
acquisitions, including Pure Fishing, Inc. and K2 Inc. These projections and
statements are based on management's estimates and assumptions with respect to
future events and financial performance and are believed to be reasonable,
though are inherently uncertain and difficult to predict. Actual results could
differ materially from those projected as a result of certain factors. A
discussion of factors that could cause results to vary is included in the
Company's periodic and other reports filed with the Securities and Exchange
Commission.
JARDEN CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
(in millions, except earnings per share)
Three months ended
June 30, 2008 June 30, 2007
AsAdjust- Adjusted AsAdjust- Adjusted
Reported ments (non-GAAP) Reported ments (non-GAAP)
(GAAP) (1)(2)(1)(2)(GAAP) (1)(2)(3) (1)(2)(3)
Net sales$1,360.0 $-- $1,360.0 $1,050.1 $ -- $1,050.1
Cost of sales 979.2 -- 979.2787.0 (27.1)759.9
Gross profit380.8 -- 380.8263.127.1 290.2
Selling, general
and administrative
expenses 256.5(4.0)252.5190.6(2.6)188.0
Reorganization and
acquisition-related
integration costs,
net 11.1 (11.1) -- 9.4(9.4) --
Operating earnings 113.215.1 128.3 63.139.1 102.2
Interest expense, net42.6 -- 42.6 32.7 -- 32.7
Loss on early
extinguishment of
debt -- ---- 0.9(0.9) --
Income before taxes 70.615.1 85.7 29.540.0 69.5
Income tax provision 27.6 3.3 30.9 12.812.2 25.0
Net income $ 43.0 $ 11.8 $ 54.8 $ 16.7 $ 27.8 $ 44.5
Earnings per share:
Basic $ 0.57 $ 0.73 $ 0.24 $ 0.64
Diluted$ 0.56 $ 0.72 $ 0.23 $ 0.62
Weighted average
shares outstanding:
Basic 75.3 75.3 69.5 69.5
Diluted76.4 76.4 71.9 71.9
See Notes to Earnings Release attached
JARDEN CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (Unaudited)
(in millions, except earnings per share)
Six months ended
June 30, 2008 June 30, 2007
AsAdjust- Adjusted AsAdjust- Adjusted
Reported ments (non-GAAP) Reported ments (non-GAAP)
(GAAP) (1)(2)(1)(2)(GAAP) (1)(2)(3) (1)(2)(3)
Net sales $2,577.4 $ -- $2,577.4 $1,871.0 $ -- $1,871.0
Cost of sales1,868.8 --1,868.8 1,406.6 (27.1) 1,379.5
Gross profit 708.6 -- 708.6 464.4 27.1 491.5
Selling, general
and administrative
expenses 516.3 (8.0) 508.3 341.8 (4.3) 337.5
Reorganization and
acquisition-related
integration costs,
net21.8 (21.8)-- 18.5 (18.5)--
Operating earnings 170.5 29.8 200.3 104.1 49.9 154.0
Interest expense, net 88.8 -- 88.8 57.7 -- 57.7
Loss on early
extinguishment of debt -- -- -- 15.7 (15.7)--
Income before taxes 81.7 29.8 111.5 30.7 65.6 96.3
Income tax provision34.06.2 40.2 12.6 22.1 34.7
Net income $ 47.7 $ 23.6 $ 71.3 $ 18.1 $ 43.5 $ 61.6
Earnings per share:
Basic $ 0.63 $ 0.95 $ 0.26 $ 0.89
Diluted$ 0.62 $ 0.93 $ 0.25 $ 0.87
Weighted average shares
outstanding :
Basic 75.2 75.2 69.3 69.3
Diluted 76.3 76.3 71.2 71.2
See Notes to Earnings Release attached
JARDEN CORPORATION
CONSOLIDATED BALANCE SHEETS (Unaudited)
(in millions)
June 30, 2008 December 31, 2007
Assets
Current assets:
Cash and cash equivalents $ 255.0 $ 220.5
Accounts receivable, net894.2 978.5
Inventories 1,258.11,126.2
Deferred taxes on income155.1 140.5
Prepaid expenses and other current assets 110.5 84.5
Total current assets2,672.92,550.2
Property, plant and equipment, net 527.3 510.9
Goodwill 1,678.51,610.8
Intangible assets, net1,056.41,126.6
Other assets 80.9 69.6
Total assets $ 6,016.0 $ 5,868.1
Liabilities and stockholders' equity
Current liabilities:
Short-term debt and current portion
of long-term debt $ 341.9 $ 297.8
Accounts payable466.8 439.3
Accrued salaries, wages and employee benefits 135.5 134.6
Taxes on income 18.8 20.9
Other current liabilities 389.2 387.8
Total current liabilities 1,352.21,280.4
Long-term debt 2,464.22,449.5
Deferred taxes on income 326.9 335.2
Other non-current liabilities 251.0 264.4
Total liabilities 4,394.34,329.5
Total stockholders' equity 1,621.71,538.6
Total liabilities and stockholders' equity$ 6,016.0 $ 5,868.1
See Notes to Earnings Release attached
JARDEN CORPORATION
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Unaudited)
(in millions)
Three months ended Six months ended
June 30, June 30, June 30, June 30,
2008 2007 2008 2007
Cash flows from operating activities:
Net income $ 43.0 $ 16.7 $ 47.7 $ 18.1
Adjustments to reconcile net income
to net cash provided by
operating activities:
Depreciation and amortization 29.8 20.7 58.938.9
Other non-cash items 24.3 2.4 25.710.7
Changes in assets and liabilities,
net of effects from acquisitions:
Accounts receivable 31.2(16.5)98.242.6
Inventory(37.7)(5.0) (123.0) (66.9)
Accounts payable 14.8 36.2 21.519.7
Other current assets and liabilities (7.1)18.9(62.2) (45.2)
Net cash provided by operating
activities 98.3 73.4 66.817.9
Cash flows from financing activities:
Net change in short-term debt (38.3)31.3 48.758.7
Proceeds from issuance of senior debt 25.0 -- 25.0 650.0
Payments on long-term debt (4.4) (21.0) (16.2) (393.7)
Proceeds from issuance of stock, net
of transaction fees 0.1 7.8 1.910.2
Repurchase of common stock and shares
tendered for taxes (0.4) (24.9) (10.9) (24.9)
Debt issuance costs (2.1)(0.5)(2.2) (31.9)
Other, net-- (0.7)(2.5) (1.1)
Net cash (used in) provided by
financing activities (20.1)(8.0)43.8 267.3
Cash flows from investing activities:
Additions to property, plant and
equipment (23.2) (22.3) (45.3) (37.3)
Acquisition of businesses, net of
cash acquired (26.6) (315.9) (29.1) (331.9)
Other (0.6) (31.0)(7.4) (31.2)
Net cash used in investing
activities(50.4) (369.2) (81.8) (400.4)
Effect of exchange rate changes on
cash and cash equivalents(0.2) -- 5.7 0.3
Net increase (decrease) in cash and
cash equivalents 27.6 (303.8)34.5 (114.9)
Cash and cash equivalents at
beginning of period 227.4391.5220.5 202.6
Cash and cash equivalents at end of
period$ 255.0 $ 87.7 $ 255.0 $ 87.7
See Notes to Earnings Release attached
JARDEN CORPORATION
NET SALES AND OPERATING EARNINGS BY SEGMENT (Unaudited)
(in millions)
Inter-
company
Branded Consumer Outdoor Process Elimina-
Consumables Solutions Solutions(a) Solutions tions(b)
Three months ended
June 30, 2008
Net sales $ 196.7 $ 380.3 $ 708.6$ 91.9 $ (17.5)
Segment earnings (loss) $ 26.4 $ 41.1 $97.5$ 11.4 $--
Adjustments to reconcile
to reported operating
earnings(loss):
Reorganization and
acquisition-related
integration costs, net (2.3) --(7.0) (0.6) --
Depreciation and
amortization(4.2) (6.4) (15.7) (3.1) --
Operating earnings
(loss) $ 19.9 $ 34.7 $74.8$ 7.7 $--
Total
Operating Corporate/
Segments UnallocatedConsolidated
Three months ended
June 30, 2008
Net sales$ 1,360.0 $-- $ 1,360.0
Segment earnings (loss) $176.4 $ (22.3) $ 154.1
Adjustments to reconcile
to reported operating
earnings(loss):
Reorganization and
acquisition-related
integration costs, net (9.9) (1.2) (11.1)
Depreciation and
amortization (29.4) (0.4) (29.8)
Operating earnings (loss)$137.1 $ (23.9) $ 113.2
Inter-
company
Branded Consumer Outdoor Process Elimina-
Consumables Solutions Solutions(a) Solutions tions(b)
Three months ended
June 30, 2007
Net sales $ 194.1 $ 366.5 $ 417.1$ 88.3 $ (15.9)
Segment earnings
(loss) $ 29.8 $ 36.7 $68.9$ 9.1 $--
Adjustments to reconcile
to reported operating
earnings(loss):
Reorganization and
acquisition-related
integration costs, net (2.0) (4.9) (2.2)-- --
Manufacturer's profit
in inventory ---- (27.1)-- --
Depreciation and
amortization(4.1) (6.6) (7.4) (2.1) --
Operating earnings
(loss) $ 23.7 $ 25.2 $32.2$ 7.0 $--
Total
Operating Corporate/
Segments UnallocatedConsolidated
Three months ended
June 30, 2007
Net sales$ 1,050.1 $-- $ 1,050.1
Segment earnings (loss) $144.5 $ (24.2) $ 120.3
Adjustments to reconcile
to reported operating
earnings(loss):
Reorganization and
acquisition-related
integration costs, net (9.1) (0.3) (9.4)
Manufacturer's profit
in inventory (27.1) -- (27.1)
Depreciation and
amortization (20.2) (0.5) (20.7)
Operating earnings
(loss) $ 88.1 $ (25.0) $63.1
Inter-
company
Branded Consumer Outdoor Process Elimina-
Consumables Solutions Solutions(a) Solutions tions(b)
Six months ended
June 30, 2008
Net sales $ 365.8 $ 699.6 $ 1,366.9$ 180.8 $ (35.7)
Segment earnings (loss) $ 40.2 $ 78.2 $ 156.7$ 20.5 $--
Adjustments to reconcile
to reported operating
earnings (loss):
Reorganization and
acquisition-related
integration costs, net (3.5) -- (14.0) (2.1) --
Depreciation and
amortization(8.4)(12.9) (30.9) (6.1) --
Operating earnings
(loss) $ 28.3 $ 65.3 $ 111.8$ 12.3 $--
Total
Operating Corporate/
Segments UnallocatedConsolidated
Six months ended
June 30, 2008
Net sales$ 2,577.4 $-- $ 2,577.4
Segment earnings (loss) $295.6 $ (44.4) $ 251.2
Adjustments to reconcile
to reported operating
earnings (loss):
Reorganization and
acquisition-related
integration costs, net (19.6) (2.2) (21.8)
Depreciation and
amortization (58.3) (0.6) (58.9)
Operating earnings
(loss) $217.7 $ (47.2) $ 170.5
Inter-
company
Branded Consumer Outdoor Process Elimina-
Consumables Solutions Solutions(a) Solutions tions(b)
Six months ended
June 30, 2007
Net sales $ 375.3 $ 724.4 $ 630.0$ 174.0 $ (32.7)
Segment earnings (loss) $ 46.3 $ 76.3 $90.9$ 16.5 $--
Adjustments to reconcile
to reported operating
earnings(loss):
Reorganization and
acquisition-related
integration costs, net (4.0)(11.2) (3.0)-- --
Manufacturer's profit
in inventory ---- (27.1)-- --
Depreciation and
amortization(8.3)(13.7) (11.7) (4.4) --
Operating earnings
(loss) $ 34.0 $ 51.4 $49.1$ 12.1 $--
Total
Operating Corporate/
Segments UnallocatedConsolidated
Six months ended
June 30, 2007
Net sales$ 1,871.0 $-- $ 1,871.0
Segment earnings (loss) $230.0 $ (41.4) $ 188.6
Adjustments to reconcile
to reported operating
earnings (loss):
Reorganization and
acquisition-related
integration costs, net (18.2) (0.3) (18.5)
Manufacturer's profit
in inventory (27.1) -- (27.1)
Depreciation and
amortization (38.1) (0.8) (38.9)
Operating earnings
(loss) $146.6 $ (42.5) $ 104.1
(a) Effective April and August 2007, the Company acquired Pure Fishing,
Inc. and K2 Inc., respectively, which, other than K2 Inc.'s monofilament
business, are reflected in the Outdoor Solutions segment from their respective
dates of acquisition. On a pro forma basis, including these acquisitions, net
sales for the three and six months ended June 30, 2007 would have been $707.6
and $1,343.1 million, respectively.
(b) Intersegment sales are recorded at cost plus an agreed upon
intercompany profit on intersegment sales.
Jarden Corporation
Notes to Earnings Release
Note 1: Adjustments relate to items that are excluded from the "as
reported" results to arrive at the "Adjusted" results for the three and six
months ended June 30, 2008 and 2007. For the three months ended June 30,
2008 adjustments to net income consist of $11.1 million of reorganization and
acquisition-related integration costs and $4.0 million of amortization of
acquired intangible assets. Also, included in the adjustments to net income
for the three months ended June 30, 2008 is the tax provision adjustment of
$3.3 million which reflects the normalization of the adjusted results to the
Company's 36% effective tax rate.
For the three months ended June 30, 2007 adjustments to net income consist
of $27.1 million of manufacturer's profit in inventory charged to cost of
sales which is the purchase accounting fair value adjustment to inventory
associated with the Pure Fishing acquisition; $9.4 million of reorganization
and acquisition-related integration costs; $2.6 million of amortization of
acquired intangible assets; and $0.9 million for the loss on the early
extinguishment of debt. Also, included in the adjustments to net income for
the three months ended June 30, 2007 is the tax provision adjustment of $12.2
million which reflects the normalization of the adjusted results to the
Company's 36% effective tax rate.
For the six months ended June 30, 2008 adjustments to net income consist
of $21.8 million of reorganization and acquisition-related integration costs
and $8.0 million of amortization of acquired intangible assets. Also,
included in the adjustments to net income for the six months ended June 30,
2008 is the tax provision adjustment of $6.2 million which reflects the
normalization of the adjusted results to the Company's 36% effective tax rate.
For the six months ended June 30, 2007 adjustments to net income consist
of $27.1 million of manufacturer's profit in inventory charged to cost of
sales which is the purchase accounting fair value adjustment to inventory
associated with the Pure Fishing acquisition; $18.5 million of reorganization
and acquisition-related integration costs; $4.3 million of amortization of
acquired intangible assets; and $15.7 million for the loss on the early
extinguishment of debt. Also, included in the adjustments to net income for
the six months ended June 30, 2007 is the tax provision adjustment of $22.1
million which reflects the normalization of the adjusted results to the
Company's 36% effective tax rate.
Note 2: This earnings release contains non-GAAP financial measures. For
purposes of Regulation G, a non-GAAP financial measure is a numerical measure
of a company's historical or future financial performance, financial position
or cash flows that excludes amounts, or is subject to adjustments that have
the effect of excluding amounts, that are included in the most directly
comparable measure calculated and presented in accordance with GAAP in the
statements of income, balance sheets, or statements of cash flows of the
Company; or includes amounts, or is subject to adjustments that have the
effect of including amounts, that are excluded from the most directly
comparable measure so calculated and presented. Pursuant to the requirements
of Regulation G, the Company has provided reconciliations of the non-GAAP
financial measures to the most directly comparable GAAP financial measures.
These non-GAAP measures are provided because management of the Company uses
these financial measures in maintaining and evaluating the Company's ongoing
financial results and trends. Management uses this non-GAAP information as an
indicator of business performance, and evaluates overall management with
respect to such indicators. Additionally, the Company uses non-GAAP financial
measures because the Company's credit agreement provides for certain
adjustments in calculations used for determining whether the Company is in
compliance with certain credit agreement covenants, including, but not limited
to, adjustments relating to non-cash purchase accounting adjustments, certain
reorganization and acquisition-related integration costs, non-cash stock-based
compensation costs and loss on early extinguishment of debt. These non-GAAP
measures should be considered in addition to, not as a substitute for,
measures of financial performance prepared in accordance with GAAP.
Note 3: In prior years, the Company had adjusted for non-cash stock
compensation costs to derive its adjusted net income. In 2008, the Company no
longer adjusts for these costs and therefore, prior year amounts have been
restated to conform with the current year presentation. The Company recorded
non-cash stock compensation costs of $10.7 million and $17.1 million for the
six months ended June 30, 2008 and 2007, respectively, and $4.7 million and
$10.3 million for the three months ended June 30, 2008 and 2007, respectively.
SOURCE Jarden Corporation
