Newell Rubbermaid Reports Third Quarter 2009 Results
Normalized EPS of $0.38, Ahead of Guidance and Prior Year Results
Gross Margin Improved 480 Basis Points to Last Year
Full Year Normalized EPS and Cash Flow Guidance Raised
Press Release
Source: Newell Rubbermaid
On 6:30 am EDT, Wednesday October 28, 2009
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Companies:Newell Rubbermaid Inc.
ATLANTA--(BUSINESS WIRE)--Newell Rubbermaid (NYSE: NWL - News) today announced third quarter 2009 financial results, including normalized earnings per share, ahead of the company’s guidance and prior year results. The company reported strong operating cash flow and gross margin improvement and increased its guidance for full year 2009 normalized EPS and operating cash flow.
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{"s" : "nwl","k" : "c10,l10,p20,t10","o" : "","j" : ""} “I am pleased that we delivered third quarter earnings and cash flow ahead of guidance despite expected revenue declines stemming from sustained challenges in the economy,” said Mark Ketchum, president and chief executive officer of Newell Rubbermaid. “We are especially pleased with our gross margin improvement, which reflects continued benefits from our planned product exits as well as a more reasonable input cost environment compared with a year ago. Our successful management of costs and our ability to drive down working capital allows us to continue to make strategic SG&A investments, while raising guidance for full year normalized EPS and operating cash flow.”
Net sales declined 17.7 percent to $1.45 billion in the third quarter, compared to $1.76 billion in the prior year, in line with the company’s guidance of a decline in the high teens percent range. Core sales were down almost 10 percent, while planned product line exits and foreign currency translation reduced net sales by 6 percent and 2 percent, respectively.
Gross margin for the quarter was 37.4 percent, up 480 basis points from last year, as the positive impact from product line exits, moderating input costs and year-over-year pricing initiatives more than offset the effects of reduced manufacturing volumes.
Excluding Project Acceleration restructuring costs of $27.0 million in 2009 and $13.5 million in 2008, operating income was $192.3 million, or 13.3 percent of sales, in the third quarter 2009, compared to $180.4 million, or 10.2 percent of sales, in the prior year.
Normalized earnings, which exclude Project Acceleration restructuring costs, related impairment charges and associated tax effects, the dilutive impact in 2009 of the company’s convertible notes, and other items, were $0.38 per diluted share, ahead of the company’s guidance and compared to $0.35 per diluted share in the third quarter 2008. For the third quarter 2009, diluted earnings per share on a normalized basis excludes the impact of $0.02 per diluted share related to the conversion feature of the convertible notes issued in March 2009 and the associated hedge transactions. Other items in the third quarter 2008 include the net of tax impact of the company’s purchase of a call option with respect to its $250 million of 6.35% Reset notes due 2028 for approximately $52 million, or approximately $0.13 per diluted share, as well as a tax benefit of $3.5 million, or $0.01 per diluted share. (A reconciliation of the “as reported” results to “normalized” results is included below.)
Net income, as reported on a GAAP basis, was $85.5 million, or $0.28 per diluted share. This compares to $55.0 million, or $0.20 per diluted share, in the third quarter 2008.
The company generated operating cash flow of $327.7 million during the third quarter, ahead of the company’s guidance of $200 to $250 million. The improvement was driven by the increase in earnings and working capital management, particularly inventory. This compares to operating cash flow of $364.3 million in the prior year. Capital expenditures were $37.0 million in the third quarter, compared to $43.9 million last year.
A reconciliation of the third quarter 2009 and last year’s results is as follows:
Q3 2009 Q3 2008
Diluted earnings per share (as reported) $0.28 $0.20
Project Acceleration restructuring costs and related impairment charges, net of tax
$0.07 $0.04
Convertible notes dilution $0.02 $0.00
Other items, net of tax $0.00 $0.12
“Normalized” EPS $0.38 $0.35
Nine Months Results
Net sales for the nine months ended September 30, 2009 declined 17.2 percent to $4.16 billion, compared to $5.02 billion in the prior year. Foreign currency translation reduced net sales by 4 percent, while planned product line exits lowered net sales by 6 percent. Acquisitions increased net sales by 1 percent and core sales softness contributed the remainder of the net sales decline.
Gross margin was 36.7 percent, a 310 basis point improvement versus the prior year. The positive impact from planned product line exits, lower input costs and 2008 pricing actions more than offset the effect of reduced manufacturing volumes and unfavorable mix.
Normalized earnings, which exclude Project Acceleration restructuring costs, related impairment charges and associated tax effects, the dilutive impact in 2009 of the company’s convertible notes, and other items, were $1.04 per diluted share, compared to $1.11 per diluted share in the prior year. For the first nine months of 2009, diluted earnings per share on a normalized basis excludes the impact of $0.03 per diluted share related to the conversion feature of the convertible notes issued in March 2009 and the associated hedge transactions. Other items for the first nine months of 2009 include one-time costs of $0.01 per diluted share incurred for the early retirement of $325 million principal amount of medium-term notes and $0.01 per diluted share of other tax adjustments. Other items in the first nine months of 2008 were the same as those for the third quarter 2008. (A reconciliation of the “as reported” results to “normalized” results is included below.)
Net income, as reported on a GAAP basis, was $224.9 million, or $0.78 per diluted share. This compares to $204.4 million, or $0.73 per diluted share, in the prior year.
The company generated operating cash flow of $415.7 million during the first nine months of 2009, compared to $243.0 million in the prior year. Capital expenditures were $107.7 million, compared to $122.1 million in the prior year.
A reconciliation of the first nine months 2009 and last year’s results is as follows:
YTD Q3 2009 YTD Q3 2008
Diluted earnings per share (as reported) $0.78 $0.73
Project Acceleration restructuring costs and related impairment charges, net of tax
$0.22 $0.25
Convertible notes dilution $0.03 $0.00
Other items, net of tax $0.02 $0.12
“Normalized” EPS $1.04 $1.11
2009 Full Year Guidance
The company continues to expect net sales for the full year will be at the unfavorable end of its guidance of a 10 to 15 percent decline. Core sales are expected to decline in the high single digit percent range. Product line exits are expected to contribute 4 to 6 percent of the sales decline and foreign currency translation is expected to reduce sales by 2 percent. Acquisitions are expected to contribute about 1 percent of sales growth.
The company is raising its guidance for normalized EPS to a range of $1.27 to $1.32 per diluted share and for operating cash flow to approximately $550 million, which is net of approximately $100 million in restructuring cash payments.
2009 Fourth Quarter Guidance
The company anticipates net sales will decline 2 to 4 percent for the fourth quarter 2009. Core sales are expected to be flat to slightly negative for the fourth quarter and product line exits are projected to reduce sales another 3 to 5 percent. Foreign currency translation is expected to increase sales by approximately 2 percent. The company expects normalized earnings of $0.23 to $0.28 per diluted share and operating cash flow of approximately $135 million.
A reconciliation of the fourth quarter and full year 2009 earnings outlook is as follows:
Q4 2009 FY 2009
Diluted earnings per share $0.16 to $0.21 $0.93 to $0.98
Project Acceleration restructuring costs and related impairment charges, net of tax
$0.06 to $0.09 $0.28 to $0.31
Convertible notes dilution - $0.03
Other items, net of tax - $0.02
“Normalized” EPS $0.23 to $0.28 $1.27 to $1.32
The impacts of the other items for the full year 2009 earnings outlook include only charges incurred during the first nine months of 2009. The impact of the convertible notes dilution of $0.03 represents the dilution through the first nine months of 2009 only. No provision is made for potential dilution from the conversion feature of the convertible notes and the associated hedge transactions in the fourth quarter of 2009.
Conference Call
The company’s third quarter 2009 earnings conference call is scheduled for today, October 28, 2009, at 10:00 am ET. To listen to the webcast, use the link provided under Events & Presentations in the Investor Relations section of Newell Rubbermaid’s Web site at www.newellrubbermaid.com. The webcast will be available for replay for two weeks. A brief supporting slide presentation will be available prior to the call under Quarterly Earnings in the Investor Relations section on the company’s Web site.
Non-GAAP Financial Measures
This release contains non-GAAP financial measures within the meaning of Regulation G promulgated by the Securities and Exchange Commission. Included in this release is a reconciliation of these non-GAAP financial measures to the most directly comparable financial measures calculated in accordance with GAAP.
About Newell Rubbermaid
Newell Rubbermaid Inc., an S&P 500 company, is a global marketer of consumer and commercial products with sales of approximately $6 billion and a strong portfolio of brands, including Rubbermaid®, Sharpie®, Graco®, Calphalon®, Irwin®, Lenox®, Levolor®, Paper Mate®, Dymo®, Waterman®, Parker®, Goody®, Technical ConceptsTM and Aprica®.
This press release and additional information about Newell Rubbermaid are available on the company’s Web site, www.newellrubbermaid.com.
Caution Concerning Forward-Looking Statements
Statements in this press release that are not historical in nature constitute forward-looking statements. These forward-looking statements relate to information or assumptions about the effects of sales, income/(loss), earnings per share, operating income or gross margin improvements or declines, Project Acceleration, capital and other expenditures, cash flow, dividends, restructuring costs, costs and cost savings, inflation or deflation, particularly with respect to commodities such as oil and resin, debt ratings, and management's plans, projections and objectives for future operations and performance. These statements are accompanied by words such as "anticipate," "expect," "project," "will," "believe," "estimate" and similar expressions. Actual results could differ materially from those expressed or implied in the forward-looking statements. Important factors that could cause actual results to differ materially from those suggested by the forward-looking statements include, but are not limited to, our dependence on the strength of retail, commercial and industrial sectors of the economy in light of the global economic slowdown; currency fluctuations; competition with other manufacturers and distributors of consumer products; major retailers' strong bargaining power; changes in the prices of raw materials and sourced products and our ability to obtain raw materials and sourced products in a timely manner from suppliers; our ability to develop innovative new products and to develop, maintain and strengthen our end-user brands; our ability to expeditiously close facilities and move operations while managing foreign regulations and other impediments; our ability to implement successfully information technology solutions throughout our organization; our ability to improve productivity and streamline operations; our ability to refinance short-term debt on terms acceptable to us, particularly given the recent turmoil and uncertainty in the global credit markets; changes to our credit ratings; significant increases in the funding obligations related to our pension plans due to declining asset values or otherwise; the imposition of tax liabilities greater than our provisions for such matters; the risks inherent in our foreign operations and those factors listed in the company’s most recent quarterly report on Form 10-Q, and exhibit 99.1 thereto, filed with the Securities and Exchange Commission. Changes in such assumptions or factors could produce significantly different results. The information contained in this news release is as of the date indicated. The company assumes no obligation to update any forward-looking statements contained in this news release as a result of new information or future events or developments.
NWL-EA
Newell Rubbermaid Inc.
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(in millions, except per share data)
Reconciliation of "As Reported" Results to "Normalized" Results
Three Months Ended September 30,
2009 2008 (1)
YOY
As Reported Excluded Items (2) Normalized As Reported Excluded Items (3) Normalized % Change
Net sales $ 1,449.0 $ - $ 1,449.0 $ 1,760.3 $ - $ 1,760.3 (17.7 )%
Cost of products sold 906.4 - 906.4 1,185.6 - 1,185.6
GROSS MARGIN 542.6 - 542.6 574.7 - 574.7 (5.6 )%
% of sales 37.4 % 37.4 % 32.6 % 32.6 %
Selling, general &
administrative expenses 350.3 - 350.3 394.3 - 394.3 (11.2 )%
% of sales 24.2 % 24.2 % 22.4 % 22.4 %
Restructuring costs 27.0 (27.0 ) - 13.5 (13.5 ) -
OPERATING INCOME 165.3 27.0 192.3 166.9 13.5 180.4 6.6 %
% of sales 11.4 % 13.3 % 9.5 % 10.2 %
Nonoperating expenses:
Interest expense, net 35.7 - 35.7 38.8 - 38.8
Other expense, net 0.6 0.6 54.8 (52.2 ) 2.6
36.3 - 36.3 93.6 (52.2 ) 41.4 (12.3 )%
INCOME BEFORE INCOME TAXES 129.0 27.0 156.0 73.3 65.7 139.0 12.2 %
% of sales 8.9 % 10.8 % 4.2 % 7.9 %
Income taxes 43.5 6.3 49.8 17.7 21.8 39.5 26.1 %
Effective rate 33.7 % 31.9 % 24.1 % 28.4 %
NET INCOME 85.5 20.7 106.2 55.6 43.9 99.5
NET INCOME NONCONTROLLING INTERESTS - - - 0.6 - 0.6
NET INCOME CONTROLLING INTEREST $ 85.5 $ 20.7 $ 106.2 $ 55.0 $ 43.9 $ 98.9 7.4 %
% of sales 5.9 % 7.3 % 3.1 % 5.6 %
EARNINGS PER SHARE:
Basic $ 0.30 $ 0.08 $ 0.38 $ 0.20 $ 0.15 $ 0.35
Diluted $ 0.28 $ 0.10 $ 0.38 $ 0.20 $ 0.15 $ 0.35
AVERAGE SHARES OUTSTANDING:
Basic 280.8 280.8 279.9 279.9
Diluted 301.8 282.5 279.9 279.9
(1) Earnings per share in 2008 has been adjusted to give effect to the retrospective adoption of an accounting standard that requires all outstanding securities with rights to receive non-forfeitable dividends to be considered an outstanding share, without regard to whether the shares are earned in the future pursuant to vesting conditions or otherwise.
(2) Items excluded from "normalized" results for 2009 consist of $27.0 million of restructuring costs, including asset impairment charges and employee termination and other costs, and the associated tax effects, as well as the dilutive impact of the convertible notes and related hedge transactions entered into during the first quarter of 2009.
(3) Items excluded from "normalized" results for 2008 consist of $13.5 million of restructuring costs, including asset impairment charges and employee termination and other costs, and the associated tax effects, the net of tax impact of the cost to purchase a call option for $52.2 million associated with the extinguishment of $250 million of medium-term Reset notes, and one-time tax benefits of $3.5 million.
Newell Rubbermaid Inc.
CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED)
(in millions, except per share data)
Reconciliation of "As Reported" Results to "Normalized" Results
Nine Months Ended September 30,
2009 2008 (1) YOY
As Reported Excluded Items (2) Normalized As Reported Excluded Items (3) Normalized % Change
Net sales $ 4,157.2 $ - $ 4,157.2 $ 5,019.1 $ - $ 5,019.1 (17.2 )%
Cost of products sold 2,633.5 - 2,633.5 3,330.7 - 3,330.7
GROSS MARGIN 1,523.7 - 1,523.7 1,688.4 - 1,688.4 (9.8 )%
% of sales 36.7 % 36.7 % 33.6 % 33.6 %
Selling, general &
administrative expenses 991.1 - 991.1 1,148.2 - 1,148.2 (13.7 )%
% of sales 23.8 % 23.8 % 22.9 % 22.9 %
Restructuring costs 87.0 (87.0 ) - 101.3 (101.3 ) -
OPERATING INCOME 445.6 87.0 532.6 438.9 101.3 540.2 (1.4 )%
% of sales 10.7 % 12.8 % 8.7 % 10.8 %
Nonoperating expenses:
Interest expense, net 106.6 - 106.6 103.3 - 103.3
Other expense (income), net 2.5 (4.7 ) (2.2 ) 55.0 (52.2 ) 2.8
109.1 (4.7 ) 104.4 158.3 (52.2 ) 106.1 (1.6 )%
INCOME BEFORE INCOME TAXES 336.5 91.7 428.2 280.6 153.5 434.1 (1.4 )%
% of sales 8.1 % 10.3 % 5.6 % 8.6 %
Income taxes 111.6 23.0 134.6 74.3 49.1 123.4 9.1 %
Effective rate 33.2 % 31.4 % 26.5 % 28.4 %
INCOME FROM CONTINUING OPERATIONS 224.9 68.7 293.6 206.3 104.4 310.7 (5.5 )%
Discontinued operations, net of tax:
Net loss - - - (0.5 ) 0.5 -
NET INCOME 224.9 68.7 293.6 205.8 104.9 310.7
NET INCOME NONCONTROLLING INTERESTS - - - 1.4 - 1.4
NET INCOME CONTROLLING INTEREST $ 224.9 $ 68.7 $ 293.6 $ 204.4 $ 104.9 $ 309.3 (5.1 )%
% of sales 5.4 % 7.1 % 4.1 % 6.2 %
EARNINGS PER SHARE FROM
CONTINUING OPERATIONS:
Basic $ 0.80 $ 0.25 $ 1.05 $ 0.73 $ 0.38 $ 1.11
Diluted $ 0.78 $ 0.26 $ 1.04 $ 0.73 $ 0.38 $ 1.11
LOSS PER SHARE FROM
DISCONTINUED OPERATIONS:
Basic $ - $ - $ - $ (0.00 ) $ 0.00 $ -
Diluted $ - $ - $ - $ (0.00 ) $ 0.00 $ -
EARNINGS PER SHARE:
Basic $ 0.80 $ 0.25 $ 1.05 $ 0.73 $ 0.38 $ 1.11
Diluted $ 0.78 $ 0.26 $ 1.04 $ 0.73 $ 0.38 $ 1.11
AVERAGE SHARES OUTSTANDING:
Basic 280.7 280.7 279.8 279.8
Diluted 289.7 281.6 279.9 279.9
(1) Earnings per share in 2008 has been adjusted to give effect to the retrospective adoption of an accounting standard that requires all outstanding securities with rights to receive non-forfeitable dividends to be considered an outstanding share, without regard to whether the shares are earned in the future pursuant to vesting conditions or otherwise.
(2) Items excluded from "normalized" results for 2009 consist of $87.0 million of restructuring costs, including asset impairment charges and employee termination and other costs, and the associated tax effects, $4.7 million of debt extinguishment charges, net of tax effects, as well as the dilutive impact of the convertible notes and related hedge transactions entered into during the first quarter of 2009.
(3) Items excluded from "normalized" results for 2008 consist of $101.3 million of restructuring costs, including asset impairment charges and employee termination and other costs, and the associated tax effects, the net of tax impact of the cost to purchase a call option for $52.2 million associated with the extinguishment of $250 million of medium-term Reset notes, one-time tax benefits of $3.5 million, and a $0.5 million net loss related to discontinued operations.
Newell Rubbermaid Inc.
CONSOLIDATED BALANCE SHEETS (UNAUDITED)
(in millions)
September 30, September 30,
Assets: 2009 2008 (1)
Cash and cash equivalents $ 313.0 $ 220.6
Accounts receivable, net 943.7 1,144.8
Inventories, net 783.5 1,060.7
Deferred income taxes 128.7 129.6
Prepaid expenses and other 93.5 122.3
Total Current Assets 2,262.4 2,678.0
Property, plant and equipment, net 596.9 656.0
Deferred income taxes 20.5 -
Goodwill 2,759.4 3,034.8
Other intangible assets, net 647.7 656.8
Other assets 336.4 232.7
Total Assets $ 6,623.3 $ 7,258.3
Liabilities and Stockholders' Equity:
Accounts payable $ 454.1 $ 608.1
Accrued compensation 148.5 112.3
Other accrued liabilities 694.5 825.9
Income taxes payable - 36.1
Short-term debt 74.0 27.3
Current portion of long-term debt 560.3 542.4
Total Current Liabilities 1,931.4 2,152.1
Long-term debt 2,032.6 2,296.7
Deferred income taxes - 38.7
Other non-current liabilities 817.9 564.4
Stockholders' Equity - Parent 1,837.9 2,203.9
Stockholders' Equity - Noncontrolling Interests 3.5 2.5
Total Stockholders' Equity 1,841.4 2,206.4
Total Liabilities and Stockholders' Equity $ 6,623.3 $ 7,258.3
(1) The September 30, 2008 Consolidated Balance Sheet reflects the retrospective adoption of certain accounting pronouncements which resulted in the reclassification of $2.5 million from Other non-current liabilities to Stockholders' Equity-Noncontrolling Interests as well as a reclassification to increase Other accrued liabilities by $28.2 million with a corresponding reduction in Stockholders' Equity-Parent.
Newell Rubbermaid Inc.
CONSOLIDATED STATEMENTS OF CASH FLOW (UNAUDITED)
(in millions)
Nine Months Ended September 30,
2009 2008
Operating Activities:
Net income controlling interest $ 224.9 $ 204.4
Adjustments to reconcile net income controlling interest to net cash provided by operating activities:
Depreciation and amortization 129.6 137.5
Deferred income taxes 11.2 23.8
Non-cash restructuring costs 24.2 45.3
Loss on sale of assets 0.1 -
Stock-based compensation expense 25.9 27.5
Loss on disposal of discontinued operations - 0.5
Other 19.9 50.4
Changes in operating assets and liabilities, excluding the effects of acquisitions:
Accounts receivable 49.6 36.9
Inventories 153.7 (85.4 )
Accounts payable (87.6 ) (44.5 )
Accrued liabilities and other (135.8 ) (151.2 )
Discontinued operations - (2.2 )
Net cash provided by operating activities $ 415.7 $ 243.0
Investing Activities:
Acquisitions, net of cash acquired $ (13.2 ) $ (660.4 )
Capital expenditures (107.7 ) (122.1 )
Proceeds from sale of non-current assets 6.9 6.4
Net cash used in investing activities $ (114.0 ) $ (776.1 )
Financing Activities:
Proceeds from issuance of debt, net of debt issuance costs $ 827.3 $ 1,317.6
Proceeds from issuance of warrants 32.7 -
Purchase of call options (69.0 ) -
Payments on notes payable and debt (969.3 ) (711.0 )
Cash dividends (57.3 ) (176.1 )
Purchase of noncontrolling interests in consolidated subsidiaries (29.0 ) -
Other, net (4.4 ) (2.5 )
Net cash (used in) provided by financing activities $ (269.0 ) $ 428.0
Currency rate effect on cash and cash equivalents $ 4.9 $ (3.5 )
Increase (decrease) in cash and cash equivalents $ 37.6 $ (108.6 )
Cash and cash equivalents at beginning of period 275.4 329.2
Cash and cash equivalents at end of period $ 313.0 $ 220.6
Newell Rubbermaid Inc.
Financial Worksheet
(In Millions)
2009 2008
Reconciliation (1) Reconciliation (1) Year-over-year changes
Reported
OI Excluded
Items Normalized
OI Operating
Margin Reported
OI Excluded
Items Normalized
OI Operating
Margin Net Sales Normalized OI (2)
Net Sales Net Sales $ % $ %
Q1:
Home & Family $ 557.7 $ 60.3 $ - $ 60.3 10.8 % $ 608.2 $ 53.4 $ - $ 53.4 8.8 % $ (50.5 ) (8.3 )% $ 6.9 12.9 %
Office Products 318.2 31.1 - 31.1 9.8 % 418.3 33.9 - 33.9 8.1 % (100.1 ) (23.9 )% (2.8 ) (8.3 )%
Tools, Hardware & Commercial Products 328.0 38.0 - 38.0 11.6 % 407.2 61.0 - 61.0 15.0 % (79.2 ) (19.4 )% (23.0 ) (37.7 )%
Restructuring Costs (30.5 ) 30.5 - (18.4 ) 18.4 -
Corporate (18.1 ) - (18.1 ) (18.8 ) - (18.8 ) 0.7 3.7 %
Total $ 1,203.9 $ 80.8 $ 30.5 $ 111.3 9.2 % $ 1,433.7 $ 111.1 $ 18.4 $ 129.5 9.0 % $ (229.8 ) (16.0 )% $ (18.2 ) (14.1 )%
2009 2008
Reconciliation (1) Reconciliation (1) Year-over-year changes
Reported
OI Excluded
Items Normalized
OI Operating
Margin Reported
OI Excluded
Items Normalized
OI Operating
Margin Net Sales Normalized OI (2)
Net Sales Net Sales $ % $ %
Q2:
Home & Family $ 617.2 $ 80.4 $ - $ 80.4 13.0 % $ 717.6 $ 69.6 $ - $ 69.6 9.7 % $ (100.4 ) (14.0 )% $ 10.8 15.5 %
Office Products 496.9 99.2 - 99.2 20.0 % 609.2 101.7 - 101.7 16.7 % (112.3 ) (18.4 )% (2.5 ) (2.5 )%
Tools, Hardware & Commercial Products 390.2 67.6 - 67.6 17.3 % 498.3 80.2 - 80.2 16.1 % (108.1 ) (21.7 )% (12.6 ) (15.7 )%
Restructuring Costs (29.5 ) 29.5 - (69.4 ) 69.4 -
Corporate (18.2 ) - (18.2 ) (21.2 ) - (21.2 ) 3.0 14.2 %
Total $ 1,504.3 $ 199.5 $ 29.5 $ 229.0 15.2 % $ 1,825.1 $ 160.9 $ 69.4 $ 230.3 12.6 % $ (320.8 ) (17.6 )% $ (1.3 ) (0.6 )%
2009 2008
Reconciliation (1) Reconciliation (1) Year-over-year changes
Reported
OI Excluded
Items Normalized
OI Operating
Margin Reported
OI Excluded
Items Normalized
OI Operating
Margin Net Sales Normalized OI (2)
Net Sales Net Sales $ % $ %
Q3:
Home & Family $ 596.8 83.9 $ 83.9 14.1 % $ 712.9 $ 60.2 $ - $ 60.2 8.4 % $ (116.1 ) (16.3 )% $ 23.7 39.4 %
Office Products 448.4 53.9 53.9 12.0 % 536.0 60.3 - 60.3 11.3 % (87.6 ) (16.3 )% (6.4 ) (10.6 )%
Tools, Hardware & Commercial Products 403.8 75.3 75.3 18.6 % 511.4 81.5 - 81.5 15.9 % (107.6 ) (21.0 )% (6.2 ) (7.6 )%
Restructuring Costs (27.0 ) 27.0 - (13.5 ) 13.5 -
Corporate (20.8 ) - (20.8 ) (21.6 ) - (21.6 ) 0.8 3.7 %
Total $ 1,449.0 $ 165.3 $ 27.0 $ 192.3 13.3 % $ 1,760.3 $ 166.9 $ 13.5 $ 180.4 10.2 % $ (311.3 ) (17.7 )% $ 11.9 6.6 %
2009 2008
Reconciliation (1) Reconciliation (1) Year-over-year changes
Reported
OI Excluded
Items Normalized
OI Operating
Margin Reported
OI Excluded
Items Normalized
OI Operating
Margin Net Sales Normalized OI (2)
Net Sales Net Sales $ % $ %
YTD:
Home & Family $ 1,771.7 $ 224.6 $ - $ 224.6 12.7 % $ 2,038.7 $ 183.2 $ - $ 183.2 9.0 % $ (267.0 ) (13.1 )% $ 41.4 22.6 %
Office Products 1,263.5 184.2 - 184.2 14.6 % 1,563.5 195.9 - 195.9 12.5 % (300.0 ) (19.2 )% (11.7 ) (6.0 )%
Tools, Hardware & Commercial Products 1,122.0 180.9 - 180.9 16.1 % 1,416.9 222.7 - 222.7 15.7 % (294.9 ) (20.8 )% (41.8 ) (18.8 )%
Restructuring Costs (87.0 ) 87.0 - (101.3 ) 101.3 -
Corporate (57.1 ) - (57.1 ) (61.6 ) - (61.6 ) 4.5 7.3 %
Total $ 4,157.2 $ 445.6 $ 87.0 $ 532.6 12.8 % $ 5,019.1 $ 438.9 $ 101.3 $ 540.2 10.8 % $ (861.9 ) (17.2 )% $ (7.6 ) (1.4 )%
(1) Excluded items are related to restructuring charges.
(2) Excluding restructuring charges.
Newell Rubbermaid Inc.
Calculation of Free Cash Flow (1)
Three Months Ended September 30,
Free Cash Flow (in millions): 2009 2008
Net cash provided by operating activities $ 327.7 $ 364.3
Capital expenditures (37.0 ) (43.9 )
Free Cash Flow $ 290.7 $ 320.4
Nine Months Ended September 30,
Free Cash Flow (in millions): 2009 2008
Net cash provided by operating activities $ 415.7 $ 243.0
Capital expenditures (107.7 ) (122.1 )
Free Cash Flow $ 308.0 $ 120.9
(1) Free Cash Flow is defined as cash flow provided by operating activities less capital expenditures.
Newell Rubbermaid Inc.
Three Months Ended September 30, 2009
In Millions
Currency Analysis
By Segment 2009 2008 Year-Over-Year (Decrease) Increase
Sales as
Reported Currency
Impact Adjusted
Sales Sales as
Reported Excluding
Currency Including
Currency Currency
Impact
Home & Family $ 596.8 $ 7.3 $ 604.1 $ 712.9 (15.3 )% (16.3 )% (1.0 )%
Office Products 448.4 18.4 466.8 536.0 (12.9 )% (16.3 )% (3.4 )%
Tools, Hardware & Commercial Products 403.8 10.9 414.7 511.4 (18.9 )% (21.0 )% (2.1 )%
Total Company $ 1,449.0 $ 36.6 $ 1,485.6 $ 1,760.3 (15.6 )% (17.7 )% (2.1 )%
By Geography
United States $ 1,008.8 $ - $ 1,008.8 $ 1,224.3 (17.6 )% (17.6 )% 0.0 %
Canada 91.8 6.8 98.6 113.5 (13.1 )% (19.1 )% (6.0 )%
1,100.6 6.8 1,107.4 1,337.8 (17.2 )% (17.7 )% (0.5 )%
Europe, Middle East, and Africa 196.4 21.3 217.7 255.5 (14.8 )% (23.1 )% (8.3 )%
Latin America 74.0 9.2 83.2 77.7 7.1 % (4.8 )% (11.8 )%
Asia Pacific 78.0 (0.7 ) 77.3 89.3 (13.4 )% (12.7 )% 0.8 %
Total Company $ 1,449.0 $ 36.6 $ 1,485.6 $ 1,760.3 (15.6 )% (17.7 )% (2.1 )%
Newell Rubbermaid Inc.
Nine Months Ended September 30, 2009
In Millions
Currency Analysis
By Segment 2009 2008 Year-Over-Year (Decrease) Increase
Sales as
Reported Currency
Impact Adjusted
Sales Sales as
Reported Excluding
Currency Including
Currency Currency
Impact
Home & Family $ 1,771.7 $ 43.0 $ 1,814.7 $ 2,038.7 (11.0 )% (13.1 )% (2.1 )%
Office Products 1,263.5 84.1 1,347.6 1,563.5 (13.8 )% (19.2 )% (5.4 )%
Tools, Hardware & Commercial Products 1,122.0 50.8 1,172.8 1,416.9 (17.2 )% (20.8 )% (3.6 )%
Total Company $ 4,157.2 $ 177.9 $ 4,335.1 $ 5,019.1 (13.6 )% (17.2 )% (3.5 )%
By Geography
United States $ 2,941.7 $ - $ 2,941.7 $ 3,470.3 (15.2 )% (15.2 )% 0.0 %
Canada 238.8 36.6 275.4 319.2 (13.7 )% (25.2 )% (11.5 )%
3,180.5 36.6 3,217.1 3,789.5 (15.1 )% (16.1 )% (1.0 )%
Europe, Middle East, and Africa 564.8 97.3 662.1 773.3 (14.4 )% (27.0 )% (12.6 )%
Latin America 189.4 32.6 222.0 210.3 5.6 % (9.9 )% (15.5 )%
Asia Pacific 222.5 11.4 233.9 246.0 (4.9 )% (9.6 )% (4.6 )%
Total Company $ 4,157.2 $ 177.9 $ 4,335.1 $ 5,019.1 (13.6 )% (17.2 )% (3.5 )%
Contact:
Newell RubbermaidNancy O’Donnell, +1 (770) 418-7723 +1 (770) 418-7723Vice President, Investor RelationsorDavid Doolittle, +1 (770) 418-7519 +1 (770) 418-7519Vice President, Corporate Communications
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