Fiscal 2013 Consolidated Financial Results
Spectrum Brands Holdings reported consolidated net sales of $4.09 billion for fiscal 2013, an increase of 25.6 percent compared to $3.25 billion for fiscal 2012. The improvement was the result of the HHI acquisition completed on December 17, 2012. Including HHI on a pro forma basis as if a part of the Company for all of both fiscal years, net sales of $4.28 billion in fiscal 2013 increased 1.2 percent compared to $4.23 billion last year, and 1.7 percent excluding the negative impact of foreign exchange.
Excluding HHI, net sales for legacy Spectrum Brands of $3.22 billion in fiscal 2013 decreased 0.9 percent versus $3.25 billion in fiscal 2012. The sales decline was primarily attributable to the planned and continuing exit of low-margin promotions in North American small appliances, which totaled approximately $45 million, partially offset by record net sales in the Global Pet Supplies and Home and Garden segments. Excluding the negative impact of foreign exchange of $18.7 million, net sales for legacy Spectrum Brands were essentially unchanged.
Gross profit and gross profit margin for fiscal 2013 of $1.39 billion and 34.0 percent, respectively, compared to $1.12 billion and 34.3 percent last year. The slight decline in gross profit margin was due to a $31 million increase in cost of goods sold from the sale of inventory that was revalued in connection with the HHI acquisition, which offset improvements to gross profit from the exit of low-margin products in North American small appliances. Gross profit margin for legacy Spectrum Brands in fiscal 2013 increased to 34.8 percent compared to 34.3 percent in fiscal 2012.Spectrum Brands reported a GAAP net loss of $55.2 million, or $1.06 diluted loss per share, for fiscal 2013 on average shares and common stock equivalents outstanding of 52.0 million. In fiscal 2012, the Company reported net income of $48.6 million, or $0.91 diluted income per share, on average shares and common stock equivalents outstanding of 53.3 million. The fiscal 2013 net loss was due entirely to $122.2 million of costs and expenses related to the extinguishment of $950 million of senior secured notes in the fourth quarter. Adjusted for certain items in both fiscal years, which are presented in Table 3 of this press release and which management believes are not indicative of the Company’s ongoing normalized operations, the Company generated adjusted diluted earnings per share, a non-GAAP measure, of $2.98 for fiscal 2013, a decrease compared to $3.21 in the prior year due to a $14.7 million increase in non-cash stock compensation expense driven by employee stock-based award programs.