Harbinger Group Inc.
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SEC Filings

8-K
HRG GROUP, INC. filed this Form 8-K on 05/05/2017
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The tables below represent a reconciliation of reported net sales to organic net sales, by product line for the Fiscal 2017 Six Months compared to net sales for the Fiscal 2016 Six Months (unaudited):
 
 
Net Sales Fiscal 2017 Six Months
 
Effect of changes in Currency
 
Organic Net Sales
Fiscal 2017 Six Months
 
Net Sales Fiscal 2016 Six Months
 
Variance
 
% Variance
Hardware and home improvement products
 
$
602.5

 
$
(1.1
)
 
$
601.4

 
$
584.3

 
$
17.1

 
2.9
 %
Consumer batteries
 
445.7

 
6.5

 
452.2

 
430.8

 
21.4

 
5.0
 %
Global pet supplies
 
386.0

 
6.2

 
392.2

 
411.9

 
(19.7
)
 
(4.8
)%
Small appliances
 
310.0

 
10.9

 
320.9

 
328.2

 
(7.3
)
 
(2.2
)%
Personal care products
 
267.3

 
5.7

 
273.0

 
277.2

 
(4.2
)
 
(1.5
)%
Global auto care
 
188.5

 
0.2

 
188.7

 
193.3

 
(4.6
)
 
(2.4
)%
Home and garden control products
 
181.7

 
—

 
181.7

 
202.7

 
(21.0
)
 
(10.4
)%
Total
 
$
2,381.7

 
$
28.4

 
$
2,410.1

 
$
2,428.4

 
$
(18.3
)
 
(0.8
)%
Adjusted EBITDA
This release contains financial information regarding Adjusted EBITDA, Adjusted EBITDA Margin, and organic Adjusted EBITDA, which are non-GAAP earnings. Adjusted EBITDA is a metric used by Spectrum Brands and this non-GAAP measure provides useful information to investors because it reflects ongoing operating performance and trends of Spectrum Brands’ segments excluding certain non-cash based expenses and/or non-recurring items during each of the comparable periods and facilitates comparisons between peer companies since interest, taxes, depreciation and amortization can differ greatly between organizations as a result of differing capital structures and tax strategies. Further, Adjusted EBITDA is a measure used for determining Spectrum Brands’ debt covenant compliance. EBITDA is calculated by excluding Spectrum Brands’ income tax expense, interest expense, depreciation expense and amortization expense (from intangible assets) from net income. Adjusted EBITDA further excludes: (1) stock based compensation expense as it is a non-cash based compensation cost; (2) acquisition and integration costs that consist of transaction costs from acquisition transactions during the period, or subsequent integration related project costs directly associated with the acquired business; (3) restructuring and related costs, which consist of project costs associated with restructuring initiatives; (4) non-cash purchase accounting inventory adjustments recognized in earnings subsequent to an acquisition; (5) non-cash asset impairments or write -offs realized; (6) and other adjustments. During the Fiscal 2017 Quarter and Fiscal 2016 Six Months, other adjustments consisted of professional fees associated with non-acquisition based strategic initiatives of Spectrum Brands. During the Fiscal 2016 Quarter and Fiscal 2016 Six Months, other adjustments consisted of costs associated with the exiting of a key executive, coupled with onboarding a key executive.
The table below shows the adjustments made to the reported net income of the Consumer Products segment to calculate its Adjusted EBITDA (unaudited):
 
 
Fiscal Quarter
 
Fiscal Six Months
Reconciliation to reported net income:
 
2017
 
2016
 
2017
 
2016
Reported net income - Consumer Products segment
 
$
58.7

 
$
92.7

 
$
123.9

 
$
166.4

Interest expense
 
50.6

 
57.5

 
106.4

 
115.9

Income tax expense (benefit)
 
33.0

 
(2.5
)
 
64.1

 
4.4

Depreciation of properties
 
24.2

 
21.4

 
46.6

 
44.4

Amortization of intangibles
 
23.5

 
23.4

 
47.1

 
47.0

      EBITDA - Consumer Products segment
 
190.0

 
192.5

 
388.1

 
378.1

Stock-based compensation
 
14.2

 
21.5

 
23.0

 
31.6

Acquisition and integration related charges
 
5.1

 
13.3

 
9.2

 
23.2

Restructuring and related charges
 
8.3

 
1.6

 
11.5

 
2.8

Other
 
2.6

 
0.7

 
2.6

 
1.0

      Adjusted EBITDA - Consumer Products segment
 
$
220.2

 
$
229.6

 
$
434.4

 
$
436.7



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