Document
false0000814453 0000814453 2020-02-10 2020-02-10
 
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
 
FORM 8-K
 
Current Report
Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of report (Date of earliest event reported): February 10, 2020
 
NEWELL BRANDS INC.
(Exact name of registrant as specified in its charter)
 
Delaware
1-9608
36-3514169
(State or Other Jurisdiction
of Incorporation)
(Commission
File Number)
(IRS Employer
Identification Number)
6655 Peachtree Dunwoody Road,
Atlanta, Georgia 30328
(Address of principal executive offices including zip code)
(770) 418-7000
(Registrant’s telephone number, including area code)
Securities registered pursuant to Section 12(b) of the Act:
TITLE OF EACH CLASS
 
TRADING SYMBOL
 
NAME OF EXCHANGE ON WHICH REGISTERED
Common stock, $1 par value per share
 
NWL
 
Nasdaq Stock Market LLC
Securities registered pursuant to Section 12(g) of the Act: None
 
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Indicate by check mark whether the registrant is an emerging growth company as defined in as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company   
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.  
 



Item 2.02.    Results of Operations and Financial Condition.
As previously disclosed, in the second half of 2019, Newell Brands Inc. (the “Company”) decided not to pursue the sale of Rubbermaid Commercial Products; Rubbermaid Outdoor, Closet, Refuse and Garage Products (the “Commercial Business”); the Mapa/Spontex ("Mapa") business and Quickie business. To provide certain supplemental information for investors, the Company has recasted its unaudited condensed consolidated statements of operations for each quarter and for full year fiscal 2018 as well as for first, second and third quarters through September 30 of fiscal 2019, to classify the Commercial Business, Mapa and Quickie Businesses in continuing operations in each of the above referenced periods.
The information in this Form 8-K shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, regardless of any general incorporation language in such filing.

Item 9.01.    Financial Statements and Exhibits.

(d)    Exhibits
Exhibit
No.
 
Exhibit Description
 
 
99.1
 
101
 
Cover Page Interactive Data File - the cover page XBRL tags are embedded within the Inline XBRL document.
104
 
The cover page from this Current Report on Form 8-K, formatted as Inline XBRL.



 
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
 
 
NEWELL BRANDS INC.
 
 
 
Dated: February 10, 2020
By:
/s/ Christopher H. Peterson
 
 
Christopher H. Peterson
 
 
Executive Vice President and Chief Financial Officer



Exhibit 99.1
NEWELL BRANDS INC.
Recasted Condensed Consolidated Statement of Operations (Unaudited) for 2018 and 2019

Exhibit


NEWELL BRANDS INC.
PROFORMA CONDENSED CONSOLIDATED STATEMENT OF OEPRATIONS (UNAUDITED)
(Amounts in millions, except per share data)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
For the three months ended March 31, 2018
 
 
As
 
Commercial
 
As
 
Normalization
 
As
 
Proforma
 
 
 
 
Reported
 
Business, Mapa
 
Recasted
 
Adjustments
 
Recasted
 
Adjustments
 
 
 
 
GAAP (1)
 
and Quickie (2)
 
GAAP
 
(3)
 
Normalized
 
(4)
 
PROFORMA
Net sales
 
$
1,811.5

 
$
361.8

 
$
2,173.3

 
$

 
$
2,173.3

 
$

 
$
2,173.3

Cost of products sold
 
1,206.2

 
249.0

 
1,455.2

 
2.8

 
1,458.0

 

 
1,458.0

Gross profit
 
605.3

 
112.8

 
718.1

 
(2.8
)
 
715.3

 

 
715.3

Selling, general and administrative expenses
 
626.3

 
55.4

 
681.7

 
(69.5
)
 
612.2

 
0.5

 
612.7

Restructuring costs, net
 
5.4

 
2.2

 
7.6

 
(7.6
)
 

 

 

Impairment of goodwill, intangibles and other assets
 

 

 

 

 

 

 

Operating income (loss)
 
(26.4
)
 
55.2

 
28.8

 
74.3

 
103.1

 
(0.5
)
 
102.6

Non-operating (income) expenses, net
 
114.7

 
0.3

 
115.0

 
0.4

 
115.4

 

 
115.4

Income (loss) before income taxes
 
(141.1
)
 
54.9

 
(86.2
)
 
73.9

 
(12.3
)
 
(0.5
)
 
(12.8
)
Income tax expense (benefit) (5)
 
(86.4
)
 
14.1

 
(72.3
)
 
16.5

 
(55.8
)
 
(0.1
)
 
(55.9
)
Income (loss) from continuing operations
 
(54.7
)
 
40.8

 
(13.9
)
 
57.4

 
43.5

 
(0.4
)
 
43.1

Income (loss) from discontinued operations, net of tax
 
108.0

 
(40.8
)
 
67.2

 
27.2

 
94.4

 

 
94.4

Net income (loss)
 
$
53.3

 
$

 
$
53.3

 
$
84.6

 
$
137.9

 
$
(0.4
)
 
$
137.5

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Weighted average common shares outstanding:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
BASIC
 
486.0

 
 
 
486.0

 
 
 
486.0

 
 
 
486.0

DILUTED
 
486.0

 
 
 
486.0

 
 
 
487.0

 
 
 
487.0

Earnings (loss) per share:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Basic:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Income (loss) from continuing operations
 
$
(0.11
)
 
 
 
$
(0.03
)
 
 
 
$
0.09

 
 
 
$
0.09

Income from discontinued operations
 
0.22

 
 
 
0.14

 
 
 
0.19

 
 
 
0.19

Net income
 
$
0.11

 
 
 
$
0.11

 
 
 
$
0.28

 
 
 
$
0.28

Diluted:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Income (loss) from continuing operations
 
$
(0.11
)
 
 
 
$
(0.03
)
 
 
 
$
0.09

 
 
 
$
0.09

Income from discontinued operations
 
0.22

 
 
 
0.14

 
 
 
0.19

 
 
 
0.19

Net income
 
$
0.11

 
 
 
$
0.11

 
 
 
$
0.28

 
 
 
$
0.28



1



(1) As reported on the Company's Quarterly Report on Form 10-Q for the three-months period ending March 31, 2019.

(2) Due to a change in strategy, management recommended and in July 2019 the Company’s Board of Directors approved the decision not to continue pursuing the sale of the majority of the Rubbermaid Commercial Products, Rubbermaid Outdoor, Closet, Refuse and Garage ("Commercial Business").

Management also concluded in October 2019 not to continue pursuing the sale of the Mapa/Spontex ("Mapa") and Quickie businesses. Based on the financial profile of these businesses, as compared to the expected proceeds, the Company determined that retention of these businesses would maximize their value to the Company.

(3) Normalization adjustments include $65.1 million of acquisition amortization costs ($30.7 million of which is reported in discontinued operations); $21.6 million of bad debt related to a customer in the Baby business; $7.9 million of restructuring ($0.3 million of which is reported in discontinued operations); $6.0 million of costs related to the proxy contest; acquisition related costs of $5.6 million; divestiture costs of $4.8 million ($2.9 million of which is reported in discontinued operations) primarily related to the planned and completed divestitures; fire-related losses, net of insurance recoveries of $(2.8) million in the Writing business; gain on disposition of $0.6 million for a working capital adjustment related to the Tools business; and $0.3 million of pension settlement costs ($0.1 million of which is reported in discontinued operations).

(4) Depreciation and amortization expense related to the Commercial Business, and the Mapa and Quickie businesses that would have been recorded had these been continuously classified as held and used.

(5) The Company determined the tax effect of the items excluded from normalized results by applying the estimated effective rate for the applicable jurisdiction in which the pre-tax items were incurred, and for which realization of the resulting tax benefit, if any, is expected. In certain situations in which an item excluded from normalized results impacts income tax expense, the Company uses a "with" and "without" approach to determine normalized income tax expense.

2



NEWELL BRANDS INC.
PROFORMA CONDENSED CONSOLIDATED STATEMENT OF OEPRATIONS (UNAUDITED)
(Amounts in millions, except per share data)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
For the three months ended June 30, 2018
 
 
As
 
Commercial
 
As
 
Normalization
 
As
 
Proforma
 
 
 
 
Reported
 
Business, Mapa
 
Recasted
 
Adjustments
 
Recasted
 
Adjustments
 
 
 
 
GAAP (1)
 
and Quickie (2)
 
GAAP
 
(3)
 
Normalized
 
(4)
 
PROFORMA
Net sales
 
$
2,201.6

 
$
402.3

 
$
2,603.9

 
$

 
$
2,603.9

 
$

 
$
2,603.9

Cost of products sold
 
1,426.8

 
267.9

 
1,694.7

 
2.4

 
1,697.1

 
6.6

 
1,703.7

Gross profit
 
774.8

 
134.4

 
909.2

 
(2.4
)
 
906.8

 
(6.6
)
 
900.2

Selling, general and administrative expenses
 
613.6

 
55.6

 
669.2

 
(55.9
)
 
613.3

 
1.0

 
614.3

Restructuring costs, net
 
45.7

 
0.9

 
46.6

 
(46.6
)
 

 

 

Impairment of goodwill, intangibles and other assets
 
31.6

 

 
31.6

 
(31.6
)
 

 

 

Operating income (loss)
 
83.9

 
77.9

 
161.8

 
131.7

 
293.5

 
(7.6
)
 
285.9

Non-operating (income) expenses, net
 
107.3

 
0.1

 
107.4

 
11.0

 
118.4

 

 
118.4

Income (loss) before income taxes
 
(23.4
)
 
77.8

 
54.4

 
120.7

 
175.1

 
(7.6
)
 
167.5

Income tax expense (benefit) (5)
 
53.0

 
(28.4
)
 
24.6

 
(53.6
)
 
(29.0
)
 
(2.1
)
 
(31.1
)
Income (loss) from continuing operations
 
(76.4
)
 
106.2

 
29.8

 
174.3

 
204.1

 
(5.5
)
 
198.6

Income (loss) from discontinued operations, net of tax
 
208.1

 
(106.2
)
 
101.9

 
72.8

 
174.7

 

 
174.7

Net income (loss)
 
$
131.7

 
$

 
$
131.7

 
$
247.1

 
$
378.8

 
$
(5.5
)
 
$
373.3

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Weighted average common shares outstanding:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
BASIC
 
486.2

 
 
 
486.2

 
 
 
486.2

 
 
 
486.2

DILUTED
 
486.2

 
 
 
487.0

 
 
 
487.0

 
 
 
487.0

Earnings (loss) per share:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Basic:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Income (loss) from continuing operations
 
$
(0.16
)
 
 
 
$
0.06

 
 
 
$
0.42

 
 
 
$
0.41

Income from discontinued operations
 
0.43

 
 
 
0.21

 
 
 
0.36

 
 
 
0.36

Net income
 
$
0.27

 
 
 
$
0.27

 
 
 
$
0.78

 
 
 
$
0.77

Diluted:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Income (loss) from continuing operations
 
$
(0.16
)
 
 
 
$
0.06

 
 
 
$
0.42

 
 
 
$
0.41

Income from discontinued operations
 
0.43

 
 
 
0.21

 
 
 
0.36

 
 
 
0.36

Net income
 
$
0.27

 
 
 
$
0.27

 
 
 
$
0.78

 
 
 
$
0.77



3



(1) As reported on the Company's Quarterly Report on Form 10-Q for the three-months period ending June 30, 2019.

(2) Due to a change in strategy, management recommended and in July 2019 the Company’s Board of Directors approved the decision not to continue pursuing the sale of the majority of the Commercial Business.

Management also concluded in October 2019 not to continue pursuing the sale of the Mapa and Quickie businesses. Based on the financial profile of these businesses, as compared to the expected proceeds, the Company determined that retention of these businesses would maximize their value to the Company.

(3) Normalization adjustments include impairment charges of $485.6 million; $31.6 million for fixed assets and $454.0 million reported in discontinued operations related to goodwill of businesses held for sale; gain on disposition of $461.2 million, reported in discontinued operations related to the sale of the Waddington business (gain of $597.6 million) and Rawlings business (loss of $136.4 million); $48.4 million of restructuring and restructuring-related charges ($1.6 million of which is reported in discontinued operations); $42.2 million of acquisition amortization costs ($8.9 million of which is reported in discontinued operations); divestiture costs of $17.0 million ($14.8 million of which is reported in discontinued operations) primarily related to planned and completed divestitures; $11.3 million of gain on legacy Jarden investment; $10.7 million of costs related to the proxy contest; acquisition related costs of $5.6 million; $3.9 million of bad debt related to a customer in the Baby business; fire-related losses net of insurance recoveries of $(2.4) million in the Writing business; and $0.4 million of pension settlement costs ($0.1 million of which is reported in discontinued operations).

(4) Depreciation and amortization expense related to the Commercial Business, and the Mapa and Quickie businesses that would have been recorded had these been continuously classified as held and used.

(5) The Company determined the tax effect of the items excluded from normalized results by applying the estimated effective rate for the applicable jurisdiction in which the pre-tax items were incurred, and for which realization of the resulting tax benefit, if any, is expected. In certain situations in which an item excluded from normalized results impacts income tax expense, the Company uses a "with" and "without" approach to determine normalized income tax expense.

4



NEWELL BRANDS INC.
PROFORMA CONDENSED CONSOLIDATED STATEMENT OF OEPRATIONS (UNAUDITED)
(Amounts in millions, except per share data)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
For the three months ended September 30, 2018
 
 
As
 
 
 
As
 
Normalization
 
As
 
Proforma
 
 
 
 
Reported
 
 Mapa
 
Recasted
 
Adjustments
 
Recasted
 
Adjustments
 
 
 
 
GAAP (1)
 
and Quickie (2)
 
GAAP
 
(3)
 
Normalized
 
(4)
 
PROFORMA
Net sales
 
$
2,548.7

 
$
121.3

 
$
2,670.0

 
$

 
$
2,670.0

 
$

 
$
2,670.0

Cost of products sold
 
1,633.3

 
83.8

 
1,717.1

 
4.0

 
1,721.1

 
9.8

 
1,730.9

Gross profit
 
915.4

 
37.5

 
952.9

 
(4.0
)
 
948.9

 
(9.8
)
 
939.1

Selling, general and administrative expenses
 
604.4

 
18.7

 
623.1

 
(38.2
)
 
584.9

 
1.3

 
586.2

Restructuring costs, net
 
12.4

 
0.9

 
13.3

 
(13.3
)
 

 

 

Impairment of goodwill, intangibles and other assets
 
8,133.7

 
1.8

 
8,135.5

 
(8,135.5
)
 

 

 

Operating income (loss)
 
(7,835.1
)
 
16.1

 
(7,819.0
)
 
8,183.0

 
364.0

 
(11.1
)
 
352.9

Non-operating (income) expenses, net
 
109.8

 
(1.0
)
 
108.8

 
(0.2
)
 
108.6

 

 
108.6

Income (loss) before income taxes
 
(7,944.9
)
 
17.1

 
(7,927.8
)
 
8,183.2

 
255.4

 
(11.1
)
 
244.3

Income tax expense (benefit) (5)
 
(1,219.6
)
 
7.0

 
(1,212.6
)
 
1,144.3

 
(68.3
)
 
(3.1
)
 
(71.4
)
Income (loss) from continuing operations
 
(6,725.3
)
 
10.1

 
(6,715.2
)
 
7,038.9

 
323.7

 
(8.0
)
 
315.7

Income (loss) from discontinued operations, net of tax
 
(585.7
)
 
(10.1
)
 
(595.8
)
 
638.9

 
43.1

 

 
43.1

Net income (loss)
 
$
(7,311.0
)
 
$

 
$
(7,311.0
)
 
$
7,677.8

 
$
366.8

 
$
(8.0
)
 
$
358.8

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Weighted average common shares outstanding:
 
471.0

 
 
 
471.0

 
 
 
471.0

 
 
 
471.0

BASIC
 
471.0

 
 
 
471.0

 
 
 
471.3

 
 
 
471.3

DILUTED
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Earnings (loss) per share:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Basic:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Income (loss) from continuing operations
 
$
(14.28
)
 
 
 
$
(14.26
)
 
 
 
$
0.69

 
 
 
$
0.67

Income (loss) from discontinued operations
 
(1.24
)
 
 
 
(1.26
)
 
 
 
0.09

 
 
 
0.09

Net income (loss)
 
$
(15.52
)
 
 
 
$
(15.52
)
 
 
 
$
0.78

 
 
 
$
0.76

Diluted:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Income (loss) from continuing operations
 
$
(14.28
)
 
 
 
$
(14.26
)
 
 
 
$
0.69

 
 
 
$
0.67

Income (loss) from discontinued operations
 
(1.24
)
 
 
 
(1.26
)
 
 
 
0.09

 
 
 
0.09

Net income (loss)
 
$
(15.52
)
 
 
 
$
(15.52
)
 
 
 
$
0.78

 
 
 
$
0.76



5



(1) As reported on the Company's Quarterly Report on Form 10-Q for the three-months period ending September 30, 2019.

(2) Management concluded in October 2019 not to continue pursuing the sale of the Mapa and Quickie businesses. Based on the financial profile of these businesses, as compared to the expected proceeds, the Company determined that retention of these businesses would maximize their value to the Company.

(3) Normalization adjustments include $8.8 billion ($4.5 billion related to goodwill, $4.3 billion to tradenames) of which $627.0 million was reported in discontinued operations primarily related to businesses held for sale; $32.6 million of acquisition amortization costs; gain on disposition of $27.5 million, reported in discontinued operations related to the sale of the Goody business (gain of $20.4 million), Waddington business (gain of $5.7 million) and Rawlings business (gain of $1.4 million); $14.2 million of restructuring and restructuring-related charges ($0.9 million of which is reported in discontinued operations); divestiture costs of $10.0 million ($6.1 million of which is reported in discontinued operations) primarily related to planned and completed divestitures; fire-related losses, net of insurance recoveries of $(4.0) million in the Writing business; acquisition related costs of $1.7 million; and $0.3 million of pension settlement costs ($0.1 million of which is reported in discontinued operations).

(4) Depreciation and amortization expense related to the Commercial Business, and the Mapa and Quickie businesses that would have been recorded had these been continuously classified as held and used.

(5) The Company determined the tax effect of the items excluded from normalized results by applying the estimated effective rate for the applicable jurisdiction in which the pre-tax items were incurred, and for which realization of the resulting tax benefit, if any, is expected. In certain situations in which an item excluded from normalized results impacts income tax expense, the Company uses a "with" and "without" approach to determine normalized income tax expense.


6



NEWELL BRANDS INC.
PROFORMA CONDENSED CONSOLIDATED STATEMENT OF OEPRATIONS (UNAUDITED)
(Amounts in millions, except per share data)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
For the three months ended December 31, 2018
 
 
As
 
Commercial
 
As
 
Normalization
 
As
 
Proforma
 
 
 
 
Reported
 
Business, Mapa
 
Recasted
 
Adjustments
 
Recasted
 
Adjustments
 
 
 
 
GAAP (1)
 
and Quickie (1) (2)
 
GAAP
 
(3)
 
Normalized
 
(4)
 
PROFORMA
Net sales
 
$
2,340.6

 
$
366.2

 
$
2,706.8

 
$

 
$
2,706.8

 
$

 
$
2,706.8

Cost of products sold
 
1,528.9

 
240.4

 
1,769.3

 
1.3

 
1,770.6

 
10.6

 
1,781.2

Gross profit
 
811.7

 
125.8

 
937.5

 
(1.3
)
 
936.2

 
(10.6
)
 
925.6

Selling, general and administrative expenses
 
619.2

 
54.6

 
673.8

 
(56.1
)
 
617.7

 
1.3

 
619.0

Restructuring costs, net
 
18.0

 
1.3

 
19.3

 
(19.3
)
 

 

 

Impairment of goodwill, intangibles and other assets
 
156.7

 
13.3

 
170.0

 
(170.0
)
 

 

 

Operating income (loss)
 
17.8

 
56.6

 
74.4

 
244.1

 
318.5

 
(11.9
)
 
306.6

Non-operating (income) expenses, net
 
107.7

 
(1.2
)
 
106.5

 
(3.4
)
 
103.1

 

 
103.1

Income (loss) before income taxes
 
(89.9
)
 
57.8

 
(32.1
)
 
247.5

 
215.4

 
(11.9
)
 
203.5

Income tax expense (benefit) (5)
 
(226.7
)
 
128.1

 
(98.6
)
 
172.1

 
73.5

 
(3.2
)
 
70.3

Income (loss) from continuing operations
 
136.8

 
(70.3
)
 
66.5

 
75.4

 
141.9

 
(8.7
)
 
133.2

Income from discontinued operations, net of tax
 
71.3

 
45.7

 
117.0

 
46.5

 
163.5

 

 
163.5

Net income (loss)
 
$
208.1

 
$
(24.6
)
 
$
183.5

 
$
121.9

 
$
305.4

 
$
(8.7
)
 
$
296.7

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Weighted average common shares outstanding:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
BASIC
 
451.5

 
 
 
451.5

 
 
 
451.5

 
 
 
451.5

DILUTED
 
451.8

 
 
 
451.8

 
 
 
451.8

 
 
 
451.8

Earnings (loss) per share:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Basic:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Income from continuing operations
 
$
0.30

 
 
 
$
0.15

 
 
 
$
0.32

 
 
 
$
0.30

Income from discontinued operations
 
0.16

 
 
 
0.26

 
 
 
0.36

 
 
 
0.36

Net income
 
$
0.46

 
 
 
$
0.41

 
 
 
$
0.68

 
 
 
$
0.66

Diluted:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Income from continuing operations
 
$
0.30

 
 
 
$
0.15

 
 
 
$
0.32

 
 
 
$
0.30

Income from discontinued operations
 
0.16

 
 
 
0.26

 
 
 
0.36

 
 
 
0.36

Net income
 
$
0.46

 
 
 
$
0.41

 
 
 
$
0.68

 
 
 
$
0.66



7



(1) The above unaudited Consolidated Statement of Operations for the three months ended December 31, 2018 has been revised for immaterial out-of-period adjustments, the Company identified during the first quarter of 2019. The Company disclosed additional information in its Quarterly Report on Form 10-Q for the three-months period ending September 30, 2019 and will disclose a revised Consolidated Statement of Operations for the year ended December 31, 2018 in the 2019 Annual Report on Form 10-K.

(2) Due to a change in strategy, management recommended and in July 2019 the Company’s Board of Directors approved the decision not to continue pursuing the sale of the majority of the Commercial Business.

Management also concluded in October 2019 not to continue pursuing the sale of the Mapa and Quickie businesses. Based on the financial profile of these businesses, as compared to the expected proceeds, the Company determined that retention of these businesses would maximize their value to the Company.                                    
(3) Normalization adjustments include impairment charges of $553.4 million ($161.4 million related to goodwill, $390.0 million to other intangible assets, $2.0 million for other assets), $383.4 million was reported in discontinued operations, primarily related to businesses held for sale; reported in discontinued operations is a net gain of $342.3 million, primarily related to the sale of the Fishing (gain of $371.6 million) and Jostens (loss of $32.1 million) businesses; $32.5 million of acquisition amortization costs; $30.6 million of restructuring and restructuring-related charges ($0.4 million of which is reported in discontinued operations); divestiture costs of $30.4 million ($20.2 million of which is reported in discontinued operations) primarily related to planned and completed divestitures; debt extinguishment costs, net of $4.1 million; acquisition related costs of $2.5 million; and gain of $1.3 million related to a sale of a small subsidiary; fire-related losses, net of insurance recoveries of $(1.3) million in the Writing business; $0.6 million of pension settlement costs.

(4) Depreciation and amortization expense related to the Commercial Business, and the Mapa and Quickie businesses that would have been recorded had these been continuously classified as held and used.

(5) The Company determined the tax effect of the items excluded from normalized results by applying the estimated effective rate for the applicable jurisdiction in which the pre-tax items were incurred, and for which realization of the resulting tax benefit, if any, is expected. In certain situations in which an item excluded from normalized results impacts income tax expense, the Company uses a "with" and "without" approach to determine normalized income tax expense.

8



NEWELL BRANDS INC.
PROFORMA CONDENSED CONSOLIDATED STATEMENT OF OEPRATIONS (UNAUDITED)
(Amounts in millions, except per share data)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
For the twelve months ended December 31, 2018
 
 
As
 
Commercial
 
As
 
Normalization
 
As
 
Proforma
 
 
 
 
Revised
 
Business, Mapa
 
Recasted
 
Adjustments
 
Recasted
 
Adjustments
 
 
 
 
GAAP (1)
 
and Quickie (2)
 
GAAP
 
(3)
 
Normalized
 
(4)
 
PROFORMA
Net sales
 
$
8,630.9

 
$
1,523.1

 
$
10,154.0

 
$

 
$
10,154.0

 
$

 
$
10,154.0

Cost of products sold
 
5,622.1

 
1,014.2

 
6,636.3

 
10.5

 
6,646.8

 
27.0

 
6,673.8

Gross profit
 
3,008.8

 
508.9

 
3,517.7

 
(10.5
)
 
3,507.2

 
(27.0
)
 
3,480.2

Selling, general and administrative expenses
 
2,434.8

 
213.0

 
2,647.8

 
(219.7
)
 
2,428.1

 
4.1

 
2,432.2

Restructuring costs, net
 
80.5

 
6.3

 
86.8

 
(86.8
)
 

 

 

Impairment of goodwill, intangibles and other assets
 
8,322.0

 
15.1

 
8,337.1

 
(8,337.1
)
 

 

 

Operating income (loss)
 
(7,828.5
)
 
274.5

 
(7,554.0
)
 
8,633.1

 
1,079.1

 
(31.1
)
 
1,048.0

Non-operating (income) expenses, net
 
439.2

 
(1.5
)
 
437.7

 
7.8

 
445.5

 

 
445.5

Income (loss) before income taxes
 
(8,267.7
)
 
276.0

 
(7,991.7
)
 
8,625.3

 
633.6

 
(31.1
)
 
602.5

Income tax expense (benefit) (5)
 
(1,478.1
)
 
119.2

 
(1,358.9
)
 
1,279.3

 
(79.6
)
 
(8.5
)
 
(88.1
)
Income (loss) from continuing operations
 
(6,789.6
)
 
156.8

 
(6,632.8
)
 
7,346.0

 
713.2

 
(22.6
)
 
690.6

Income (loss) from discontinued operations, net of tax
 
(152.9
)
 
(156.8
)
 
(309.7
)
 
785.4

 
475.7

 

 
475.7

Net income (loss)
 
$
(6,942.5
)
 
$

 
$
(6,942.5
)
 
$
8,131.4

 
$
1,188.9

 
$
(22.6
)
 
$
1,166.3

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Weighted average common shares outstanding:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
BASIC
 
473.7

 
 
 
473.7

 
 
 
473.7

 
 
 
473.7

DILUTED
 
473.7

 
 
 
473.7

 
 
 
474.3

 
 
 
474.3

Earnings (loss) per share:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Basic:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Income (loss) from continuing operations
 
$
(14.33
)
 
 
 
$
(14.00
)
 
 
 
$
1.51

 
 
 
$
1.46

Income (loss) from discontinued operations
 
(0.32
)
 
 
 
(0.65
)
 
 
 
1.00

 
 
 
1.00

Net income (loss)
 
$
(14.65
)
 
 
 
$
(14.65
)
 
 
 
$
2.51

 
 
 
$
2.46

Diluted:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Income (loss) from continuing operations
 
$
(14.33
)
 
 
 
$
(14.00
)
 
 
 
$
1.51

 
 
 
$
1.46

Income (loss) from discontinued operations
 
(0.32
)
 
 
 
(0.65
)
 
 
 
1.00

 
 
 
1.00

Net income (loss)
 
$
(14.65
)
 
 
 
$
(14.65
)
 
 
 
$
2.51

 
 
 
$
2.46



9



(1) The above unaudited Consolidated Statement of Operations for the twelve months ended December 31, 2018 has been revised for immaterial out-of-period adjustments, the Company identified during the first quarter of 2019. The Company disclosed additional information in its Quarterly Report on Form 10-Q for the three-months period ending September 30, 2019 and will disclose a revised Consolidated Statement of Operations for the year ended December 31, 2018 in the 2019 Annual Report on Form 10-K.

(2) Due to a change in strategy, management recommended and in July 2019 the Company’s Board of Directors approved the decision not to continue pursuing the sale of the majority of the Commercial Business.

Management also concluded in October 2019 not to continue pursuing the sale of the Mapa and Quickie businesses. Based on the financial profile of these businesses, as compared to the expected proceeds, the Company determined that retention of these businesses would maximize their value to the Company.

(3) Normalization adjustments include impairment charges of $$9.8 billion ($5.1 billion related to goodwill, $4.7 billion to other intangible assets, $41.1 million for other assets), $1.5 billion was reported in discontinued operations, primarily related to businesses held for sale; reported in discontinued operations is a net gain of $831.0 million, primarily related to the sale of the Fishing, Jostens, Goody and Rawlings businesses; $172.3 million of acquisition amortization costs ($39.5 million of which is reported in discontinued operations); $101.1 million of restructuring and restructuring-related charges ($3.2 million of which is reported in discontinued operations); divestiture costs of $62.2 million ($44.0 million of which is reported in discontinued operations) primarily related to planned and completed divestitures; $25.5 million of bad debt related to a customer in the Baby business; $16.7 million of costs related to the proxy contest; acquisition related costs of $15.4 million; $11.3 million gain on legacy Jarden investment; fire-related losses, net of insurance recoveries of $(10.5) million in the Writing business; debt extinguishment costs, net of $4.1 million; gain of $1.9 million related to the sale of Tools business and a small subsidiary and $1.6 million of pension settlement costs ($0.3 million of which is reported in discontinued operations).

(4) Depreciation and amortization expense related to the Commercial Business, and the Mapa and Quickie businesses that would have been recorded had these been continuously classified as held and used.

(5) The Company determined the tax effect of the items excluded from normalized results by applying the estimated effective rate for the applicable jurisdiction in which the pre-tax items were incurred, and for which realization of the resulting tax benefit, if any, is expected. In certain situations in which an item excluded from normalized results impacts income tax expense, the Company uses a "with" and "without" approach to determine normalized income tax expense.



10



NEWELL BRANDS INC.
PROFORMA CONDENSED CONSOLIDATED STATEMENT OF OEPRATIONS (UNAUDITED)
(Amounts in millions, except per share data)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
For the three months ended March 31, 2019
 
 
As
 
Commercial
 
As
 
Normalization
 
As
 
Proforma
 
 
 
 
Reported
 
Business, Mapa
 
Recasted
 
Adjustments
 
Recasted
 
Adjustments
 
 
 
 
GAAP (1)
 
and Quickie (2)
 
GAAP
 
(3)
 
Normalized
 
(4)
 
PROFORMA
Net sales
 
$
1,712.1

 
$
329.7

 
$
2,041.8

 
$

 
$
2,041.8

 
$

 
$
2,041.8

Cost of products sold
 
1,168.3

 
218.9

 
1,387.2

 
(2.2
)
 
1,385.0

 
9.6

 
1,394.6

Gross profit
 
543.8

 
110.8

 
654.6

 
2.2

 
656.8

 
(9.6
)
 
647.2

Selling, general and administrative expenses
 
517.9

 
50.8

 
568.7

 
(46.8
)
 
521.9

 
1.1

 
523.0

Restructuring costs, net
 
10.9

 

 
10.9

 
(10.9
)
 

 

 

Impairment of goodwill, intangibles and other assets
 

 
63.0

 
63.0

 
(63.0
)
 

 

 

Operating income (loss)
 
15.0

 
(3.0
)
 
12.0

 
122.9

 
134.9

 
(10.7
)
 
124.2

Non-operating (income) expenses, net
 
103.5

 
2.3

 
105.8

 
(20.5
)
 
85.3

 

 
85.3

Income (loss) before income taxes
 
(88.5
)
 
(5.3
)
 
(93.8
)
 
143.4

 
49.6

 
(10.7
)
 
38.9

Income tax expense (benefit) (5)
 
(16.7
)
 
(2.9
)
 
(19.6
)
 
26.4

 
6.8

 
(2.9
)
 
3.9

Income (loss) from continuing operations
 
(71.8
)
 
(2.4
)
 
(74.2
)
 
117.0

 
42.8

 
(7.8
)
 
35.0

Income (loss) from discontinued operations, net of tax
 
(79.4
)
 
2.4

 
(77.0
)
 
95.1

 
18.1

 

 
18.1

Net income (loss)
 
$
(151.2
)
 
$

 
$
(151.2
)
 
$
212.1

 
$
60.9

 
$
(7.8
)
 
$
53.1

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Weighted average common shares outstanding:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
BASIC
 
423.0

 
 
 
423.0

 
 
 
423.0

 
 
 
423.0

DILUTED
 
423.0

 
 
 
423.0

 
 
 
423.4

 
 
 
423.4

Earnings (loss) per share:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Basic:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Income (loss) from continuing operations
 
$
(0.17
)
 
 
 
$
(0.18
)
 
 
 
$
0.10

 
 
 
$
0.08

Income (loss) from discontinued operations
 
(0.19
)
 
 
 
(0.18
)
 
 
 
0.04

 
 
 
0.04

Net income (loss)
 
$
(0.36
)
 
 
 
$
(0.36
)
 
 
 
$
0.14

 
 
 
$
0.12

Diluted:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Income (loss) from continuing operations
 
$
(0.17
)
 
 
 
$
(0.18
)
 
 
 
$
0.10

 
 
 
$
0.08

Income (loss) from discontinued operations
 
(0.19
)
 
 
 
(0.18
)
 
 
 
0.04

 
 
 
0.04

Net income (loss)
 
$
(0.36
)
 
 
 
$
(0.36
)
 
 
 
$
0.14

 
 
 
$
0.12



11



(1) As reported on the Company's Quarterly Report on Form 10-Q for the three-months period ending March 31, 2019.

(2) Due to a change in strategy, management recommended and in July 2019 the Company’s Board of Directors approved the decision not to continue pursuing the sale of the majority of the Commercial Business.

Management also concluded in October 2019 not to continue pursuing the sale of the Mapa and Quickie businesses. Based on the financial profile of these businesses, as compared to the expected proceeds, the Company determined that retention of these businesses would maximize their value to the Company.

(3) Normalization adjustments include impairment charges of $174.7 million ($111.7 million is reported in discontinued operations) related to goodwill and other intangible assets; acquisition amortization costs of $33.0 million; restructuring and restructuring related costs of $17.6 million (reversal of $0.2 million is reported in discontinued operations); loss of $17.1 million due to changes in the fair value of certain investments; divestiture costs of $8.4 million ($2.4 million of which is reported in discontinued operations) primarily related to planned and completed divestitures; net gain on disposition of $5.2 million (reported in discontinued operations) for working capital adjustments related to the sale of the Waddington, Jostens and Fishing businesses; Argentina hyperinflationary adjustment of $4.5 million; acquisition related costs of $1.4 million and $0.6 million of other charges, primarily related to fees for certain legal proceedings.

(4) Depreciation and amortization expense related to the Commercial Business, and the Mapa and Quickie businesses that would have been recorded had these been continuously classified as held and used.

(5) The Company determined the tax effect of the items excluded from normalized results by applying the estimated effective rate for the applicable jurisdiction in which the pre-tax items were incurred, and for which realization of the resulting tax benefit, if any, is expected. In certain situations in which an item excluded from normalized results impacts income tax expense, the Company uses a "with" and "without" approach to determine normalized income tax expense.


12



NEWELL BRANDS INC.
PROFORMA CONDENSED CONSOLIDATED STATEMENT OF OEPRATIONS (UNAUDITED)
(Amounts in millions, except per share data)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
For the three months ended June 30, 2019
 
 
As
 
Commercial
 
As
 
Normalization
 
As
 
Proforma
 
 
 
 
Reported
 
Business, Mapa
 
Recasted
 
Adjustments
 
Recasted
 
Adjustments
 
 
 
 
GAAP (1)
 
and Quickie (2)
 
GAAP
 
(3)
 
Normalized
 
(4)
 
PROFORMA
Net sales
 
$
2,116.5

 
$
364.1

 
$
2,480.6

 
$

 
$
2,480.6

 
$

 
$
2,480.6

Cost of products sold
 
1,369.9

 
245.3

 
1,615.2

 
(9.5
)
 
1,605.7

 
9.4

 
1,615.1

Gross profit
 
746.6

 
118.8

 
865.4

 
9.5

 
874.9

 
(9.4
)
 
865.5

Selling, general and administrative expenses
 
558.9

 
53.8

 
612.7

 
(51.0
)
 
561.7

 
1.1

 
562.8

Restructuring costs, net
 
6.7

 
1.3

 
8.0

 
(8.0
)
 

 

 

Impairment of goodwill, intangibles and other assets
 
2.9

 
11.0

 
13.9

 
(13.9
)
 

 

 

Operating income (loss)
 
178.1

 
52.7

 
230.8

 
82.4

 
313.2

 
(10.5
)
 
302.7

Non-operating (income) expenses, net
 
78.4

 

 
78.4

 
(0.5
)
 
77.9

 

 
77.9

Income (loss) before income taxes
 
99.7

 
52.7

 
152.4

 
82.9

 
235.3

 
(10.5
)
 
224.8

Income tax expense (benefit) (5)
 
16.7

 
12.7

 
29.4

 
31.5

 
60.9

 
(2.8
)
 
58.1

Income (loss) from continuing operations
 
83.0