Exhibit
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HRG Group, Inc. Reports First Quarter Results Achieves Consolidated Revenue Growth of 7.4% Over the First Quarter of 2015 |
NEW YORK - February 5, 2016 -- HRG Group, Inc. (“HRG” or the “Company”; NYSE: HRG), a diversified holding company focused on owning businesses that it believes can, in the long term, generate sustainable free cash flow or attractive returns on investment, today announced its consolidated results for the first quarter of Fiscal 2016 ended on December 31, 2015 (the “Fiscal 2016 Quarter”). The results include HRG's four segments:
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• | Consumer Products, which consists of Spectrum Brands Holdings, Inc. and its subsidiaries (“Spectrum Brands”; NYSE: SPB); |
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• | Insurance, which consists of Front Street Re (Delaware) Ltd. and its subsidiaries (“Front Street”); |
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• | Energy, which consists of Compass Production Partners, LP and its subsidiaries (“Compass”); and |
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• | Asset Management, which consists of Salus Capital Partners, LLC (“Salus”), Energy & Infrastructure Capital, LLC (“EIC”) and CorAmerica Capital, LLC (“CorAmerica”). |
"HRG reported very strong results this quarter, highlighted by solid consolidated topline growth at
HRG overall as well as another excellent performance from the Consumer Products segment, which included record first quarter revenue and Adjusted EBITDA at Spectrum Brands," said Omar Asali, President and Chief Executive Officer of HRG. "We also made excellent progress this quarter executing against our strategic initiatives, which, at Fidelity & Guaranty Life, included advancing the transaction with Anbang; at Spectrum Brands, an increase of the quarterly dividend to $0.38 per SPB share; at Compass, substantially reducing its leverage while maintaining its profitability on an Adjusted EBITDA basis in spite of very challenging commodity market conditions; and overall, significantly reducing our operating expenses, including at the Asset Management segment.
"Looking ahead, we continue to anticipate that the Fidelity & Guaranty Life transaction will close in the upcoming second quarter of calendar year 2016, and expect to realize our return in a tax-efficient manner. We will outline our plan for our use of the proceeds following the closing, but we remain committed to deleveraging and pursuing strategies to maximize shareholder value.
"Looking further into the year, we expect the momentum in Spectrum Brands will continue in Fiscal 2016, and we anticipate record levels of annual revenue, Adjusted EBITDA and free cash flow from that business. We will continue to look for opportunities to grow this important segment throughout 2016 from both organic sources and attractive M&A, and will be supportive in their pursuits of growth."
Important Note Regarding the Presentation of our Insurance Segment:
During the quarter, Fidelity & Guaranty Life (“FGL”; NYSE: FGL) announced it had reached a definitive merger agreement under which Anbang Insurance Group Co., Ltd. and certain of its subsidiaries will acquire FGL for $26.80 per share in cash. At the date of the transaction, the Company owned 47 million shares in FGL, or an 80.4% interest as of December 31, 2015. The transaction, which is subject to customary closing conditions and regulatory approvals, is expected to close in the second quarter of calendar year 2016.
As a result of this agreement, beginning with the first quarter of Fiscal 2016, the Company's investment in FGL has been classified as held for sale on the balance sheet and FGL's operations have been classified as discontinued operations, and results for all periods have been reclassified accordingly. Previously, FGL's results were reflected in the Insurance segment; however, all segment information has been adjusted to exclude FGL's results from this segment. Accordingly, the commentary for the Insurance segment in this release no longer reflects the performance of FGL in either the current or prior year quarters.
