| DEBT
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Three Months Ended | Six Months Ended | ||||||||||||||
June 28, 2013 | June 29, 2012 | June 28, 2013 | June 29, 2012 | ||||||||||||
Remeasurement of multicurrency balances | $ | (6.0 | ) | $ | (9.8 | ) | $ | (11.4 | ) | $ | (12.1 | ) | |||
Venezuelan devaluation | — | — | (1.1 | ) | — | ||||||||||
Revaluation of foreign currency forward contracts | 3.6 | 6.0 | 8.9 | 6.9 | |||||||||||
Hedge costs | (0.5 | ) | (0.8 | ) | (1.1 | ) | (1.6 | ) | |||||||
Total foreign exchange loss | $ | (2.9 | ) | $ | (4.6 | ) | $ | (4.7 | ) | $ | (6.8 | ) |
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June 28, 2013 | December 28, 2012 | ||||||
(In millions) | |||||||
Long-term debt: | |||||||
Senior notes due 2019 | $ | 350.0 | $ | 350.0 | |||
Accounts receivable securitization facility | 235.0 | 82.0 | |||||
Senior notes due 2015 | 200.0 | 200.0 | |||||
Senior notes due 2014 | 31.9 | 31.6 | |||||
Revolving lines of credit and other | 28.6 | 20.8 | |||||
Convertible senior notes due 2013 | — | 297.8 | |||||
Total long-term debt | 845.5 | 982.2 | |||||
Short-term debt | 7.0 | 0.9 | |||||
Total debt | $ | 852.5 | $ | 983.1 |
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Three Months Ended | |||||||||||||||||||||||
Domestic (a) | Foreign | Total | |||||||||||||||||||||
June 28, 2013 | June 29, 2012 | June 28, 2013 | June 29, 2012 | June 28, 2013 | June 29, 2012 | ||||||||||||||||||
Service cost | $ | 2.0 | $ | 2.8 | $ | 1.7 | $ | 1.4 | $ | 3.7 | $ | 4.2 | |||||||||||
Interest cost | 2.4 | 3.2 | 2.4 | 2.4 | 4.8 | 5.6 | |||||||||||||||||
Expected return on plan assets | (2.9 | ) | (2.4 | ) | (2.6 | ) | (2.4 | ) | (5.5 | ) | (4.8 | ) | |||||||||||
Net amortization (b) | 0.8 | 2.3 | 0.4 | 0.2 | 1.2 | 2.5 | |||||||||||||||||
Net periodic cost | $ | 2.3 | $ | 5.9 | $ | 1.9 | $ | 1.6 | $ | 4.2 | $ | 7.5 |
Six Months Ended | |||||||||||||||||||||||
Domestic (a) | Foreign | Total | |||||||||||||||||||||
June 28, 2013 | June 29, 2012 | June 28, 2013 | June 29, 2012 | June 28, 2013 | June 29, 2012 | ||||||||||||||||||
Service cost | $ | 4.2 | $ | 5.0 | $ | 3.4 | $ | 2.8 | $ | 7.6 | $ | 7.8 | |||||||||||
Interest cost | 4.8 | 6.3 | 4.7 | 4.7 | 9.5 | 11.0 | |||||||||||||||||
Expected return on plan assets | (5.9 | ) | (5.6 | ) | (5.2 | ) | (4.9 | ) | (11.1 | ) | (10.5 | ) | |||||||||||
Net amortization (b) | 1.6 | 4.3 | 0.8 | 0.5 | 2.4 | 4.8 | |||||||||||||||||
Net periodic cost | $ | 4.7 | $ | 10.0 | $ | 3.7 | $ | 3.1 | $ | 8.4 | $ | 13.1 |
(a) | Domestic pension costs are lower in the three and six months ended June 28, 2013 as compared to the corresponding periods in the prior year as a result of the plan amendment to our U.S. defined benefit plan which was completed in the fourth quarter of 2012. |
(b) | Reclassified into operating expenses from AOCI. |
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June 28, 2013 | December 28, 2012 | ||||||
(Unaudited) | |||||||
Assets: | |||||||
Current assets | $ | 2,355.2 | $ | 2,449.3 | |||
Property, equipment and capital leases, net | 114.3 | 108.7 | |||||
Goodwill | 342.8 | 342.0 | |||||
Other assets | 167.9 | 201.5 | |||||
Subordinated notes receivable from parent | — | 5.0 | |||||
$ | 2,980.2 | $ | 3,106.5 | ||||
Liabilities and Stockholder’s Equity: | |||||||
Current liabilities | $ | 924.8 | $ | 963.1 | |||
Subordinated notes payable to parent | 7.5 | — | |||||
Long-term debt | 861.4 | 700.8 | |||||
Other liabilities | 145.2 | 168.6 | |||||
Stockholder’s equity | 1,041.3 | 1,274.0 | |||||
$ | 2,980.2 | $ | 3,106.5 |
Three Months Ended | Six Months Ended | ||||||||||||||
June 28, 2013 | June 29, 2012 | June 28, 2013 | June 29, 2012 | ||||||||||||
Net sales | $ | 1,579.5 | $ | 1,577.0 | $ | 3,070.4 | $ | 3,099.7 | |||||||
Operating income | $ | 87.0 | $ | 91.1 | $ | 169.4 | $ | 179.1 | |||||||
Income from continuing operations before income taxes | $ | 71.4 | $ | 75.7 | $ | 140.6 | $ | 153.5 | |||||||
Net income (loss) from discontinued operations | $ | 0.2 | $ | (0.1 | ) | $ | 0.1 | $ | (0.4 | ) | |||||
Net income | $ | 45.3 | $ | 47.7 | $ | 90.2 | $ | 106.9 | |||||||
Comprehensive income | $ | 33.1 | $ | 28.0 | $ | 69.8 | $ | 106.7 |
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Restructuring Charge | |||||||||||
Employee-Related Costs (a) | Facility Exit and Other Costs (b) | Total | |||||||||
Balance at December 28, 2012 | $ | 6.7 | $ | 2.4 | $ | 9.1 | |||||
Payments and other | (3.0 | ) | (0.8 | ) | (3.8 | ) | |||||
Balance at June 28, 2013 | $ | 3.7 | $ | 1.6 | $ | 5.3 |
(a) | Employee-related costs primarily consist of termination benefits provided to employees who have been involuntarily terminated. |
(b) | Facility exit and other costs primarily consist of lease termination costs. |
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Expected Stock Price Volatility | Risk-Free Interest Rate | Expected Dividend Yield | Average Expected Life | Exercise Price | Resulting Black-Scholes Value | ||||||||||||
42.0 | % | 1.1 | % | — | % | 6.12 years | $ | 68.64 | $ | 28.57 |
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Second Quarter of 2013 | ECS | W&C | OEM Supply | Corporate | Total | ||||||||||||||
Net sales | $ | 813.8 | $ | 530.6 | $ | 235.1 | $ | — | $ | 1,579.5 | |||||||||
Operating income | 42.0 | 38.1 | 5.7 | — | 85.8 | ||||||||||||||
Depreciation | 2.9 | 1.7 | 0.9 | — | 5.5 | ||||||||||||||
Amortization of intangibles | 0.2 | 1.7 | 0.4 | — | 2.3 | ||||||||||||||
Capital expenditures | 0.6 | 0.2 | 0.6 | 7.4 | 8.8 |
Second Quarter of 2012 | ECS | W&C | OEM Supply | Corporate | Total | ||||||||||||||
Net sales | $ | 820.5 | $ | 516.0 | $ | 240.5 | $ | — | $ | 1,577.0 | |||||||||
Operating income | 39.6 | 43.4 | 6.9 | — | 89.9 | ||||||||||||||
Depreciation | 2.7 | 1.5 | 1.4 | — | 5.6 | ||||||||||||||
Amortization of intangibles | 0.2 | 0.6 | 1.8 | — | 2.6 | ||||||||||||||
Capital expenditures | 1.0 | 0.2 | 0.9 | 6.5 | 8.6 |
Six Months of 2013 | ECS | W&C | OEM Supply | Corporate | Total | ||||||||||||||
Net sales | $ | 1,558.9 | $ | 1,048.4 | $ | 463.1 | $ | — | $ | 3,070.4 | |||||||||
Operating income | 76.8 | 79.4 | 10.6 | — | 166.8 | ||||||||||||||
Depreciation | 5.8 | 3.6 | 1.7 | — | 11.1 | ||||||||||||||
Amortization of intangibles | 0.4 | 3.1 | 0.7 | — | 4.2 | ||||||||||||||
Total assets | 1,239.8 | 969.6 | 452.4 | 306.8 | 2,968.6 | ||||||||||||||
Capital expenditures | 1.4 | 0.4 | 1.9 | 14.2 | 17.9 |
Six Months of 2012 | ECS | W&C | OEM Supply | Corporate | Total | ||||||||||||||
Net sales | $ | 1,599.3 | $ | 1,000.7 | $ | 499.7 | $ | — | $ | 3,099.7 | |||||||||
Operating income | 77.8 | 83.2 | 15.6 | — | 176.6 | ||||||||||||||
Depreciation | 5.3 | 3.0 | 2.8 | — | 11.1 | ||||||||||||||
Amortization of intangibles | 0.4 | 1.2 | 3.7 | — | 5.3 | ||||||||||||||
Total assets (a) | 1,272.4 | 997.9 | 461.6 | 357.7 | 3,089.6 | ||||||||||||||
Capital expenditures | 2.8 | 0.6 | 2.8 | 12.4 | 18.6 |
(a) | Total assets for 2012 are as of December 28, 2012. |
Reportable Segments | |||||||||||||||
ECS | W&C | OEM Supply | Total | ||||||||||||
Balance as of December 28, 2012 | $ | 164.1 | $ | 177.9 | $ | — | $ | 342.0 | |||||||
Acquisition related (a) | — | 2.6 | — | 2.6 | |||||||||||
Foreign currency translation | (1.2 | ) | (0.6 | ) | — | (1.8 | ) | ||||||||
Balance as of June 28, 2013 | $ | 162.9 | $ | 179.9 | $ | — | $ | 342.8 |
(a) | In the quarter ended June 28, 2013, we recorded an immaterial reclassification adjustment between intangible assets and goodwill related to the purchase price allocation related to the acquisition of Jorvex, S.A. |
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Three Months Ended | Six Months Ended | ||||||||||||||
June 28, 2013 | June 29, 2012 | June 28, 2013 | June 29, 2012 | ||||||||||||
Remeasurement of multicurrency balances | $ | (6.0 | ) | $ | (9.8 | ) | $ | (11.4 | ) | $ | (12.1 | ) | |||
Venezuelan devaluation | — | — | (1.1 | ) | — | ||||||||||
Revaluation of foreign currency forward contracts | 3.6 | 6.0 | 8.9 | 6.9 | |||||||||||
Hedge costs | (0.5 | ) | (0.8 | ) | (1.1 | ) | (1.6 | ) | |||||||
Total foreign exchange loss | $ | (2.9 | ) | $ | (4.6 | ) | $ | (4.7 | ) | $ | (6.8 | ) |
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Three Months Ended | Six Months Ended | ||||||||||||||
June 28, 2013 | June 29, 2012 | June 28, 2013 | June 29, 2012 | ||||||||||||
Remeasurement of multicurrency balances | $ | (6.0 | ) | $ | (9.8 | ) | $ | (11.4 | ) | $ | (12.1 | ) | |||
Venezuelan devaluation | — | — | (1.1 | ) | — | ||||||||||
Revaluation of foreign currency forward contracts | 3.6 | 6.0 | 8.9 | 6.9 | |||||||||||
Hedge costs | (0.5 | ) | (0.8 | ) | (1.1 | ) | (1.6 | ) | |||||||
Total foreign exchange loss | $ | (2.9 | ) | $ | (4.6 | ) | $ | (4.7 | ) | $ | (6.8 | ) |
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June 28, 2013 | December 28, 2012 | ||||||
(In millions) | |||||||
Long-term debt: | |||||||
Senior notes due 2019 | $ | 350.0 | $ | 350.0 | |||
Accounts receivable securitization facility | 235.0 | 82.0 | |||||
Senior notes due 2015 | 200.0 | 200.0 | |||||
Senior notes due 2014 | 31.9 | 31.6 | |||||
Revolving lines of credit and other | 28.6 | 20.8 | |||||
Convertible senior notes due 2013 | — | 297.8 | |||||
Total long-term debt | 845.5 | 982.2 | |||||
Short-term debt | 7.0 | 0.9 | |||||
Total debt | $ | 852.5 | $ | 983.1 |
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Three Months Ended | |||||||||||||||||||||||
Domestic (a) | Foreign | Total | |||||||||||||||||||||
June 28, 2013 | June 29, 2012 | June 28, 2013 | June 29, 2012 | June 28, 2013 | June 29, 2012 | ||||||||||||||||||
Service cost | $ | 2.0 | $ | 2.8 | $ | 1.7 | $ | 1.4 | $ | 3.7 | $ | 4.2 | |||||||||||
Interest cost | 2.4 | 3.2 | 2.4 | 2.4 | 4.8 | 5.6 | |||||||||||||||||
Expected return on plan assets | (2.9 | ) | (2.4 | ) | (2.6 | ) | (2.4 | ) | (5.5 | ) | (4.8 | ) | |||||||||||
Net amortization (b) | 0.8 | 2.3 | 0.4 | 0.2 | 1.2 | 2.5 | |||||||||||||||||
Net periodic cost | $ | 2.3 | $ | 5.9 | $ | 1.9 | $ | 1.6 | $ | 4.2 | $ | 7.5 |
Six Months Ended | |||||||||||||||||||||||
Domestic (a) | Foreign | Total | |||||||||||||||||||||
June 28, 2013 | June 29, 2012 | June 28, 2013 | June 29, 2012 | June 28, 2013 | June 29, 2012 | ||||||||||||||||||
Service cost | $ | 4.2 | $ | 5.0 | $ | 3.4 | $ | 2.8 | $ | 7.6 | $ | 7.8 | |||||||||||
Interest cost | 4.8 | 6.3 | 4.7 | 4.7 | 9.5 | 11.0 | |||||||||||||||||
Expected return on plan assets | (5.9 | ) | (5.6 | ) | (5.2 | ) | (4.9 | ) | (11.1 | ) | (10.5 | ) | |||||||||||
Net amortization (b) | 1.6 | 4.3 | 0.8 | 0.5 | 2.4 | 4.8 | |||||||||||||||||
Net periodic cost | $ | 4.7 | $ | 10.0 | $ | 3.7 | $ | 3.1 | $ | 8.4 | $ | 13.1 |
(a) | Domestic pension costs are lower in the three and six months ended June 28, 2013 as compared to the corresponding periods in the prior year as a result of the plan amendment to our U.S. defined benefit plan which was completed in the fourth quarter of 2012. |
(b) | Reclassified into operating expenses from AOCI. |
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June 28, 2013 | December 28, 2012 | ||||||
(Unaudited) | |||||||
Assets: | |||||||
Current assets | $ | 2,355.2 | $ | 2,449.3 | |||
Property, equipment and capital leases, net | 114.3 | 108.7 | |||||
Goodwill | 342.8 | 342.0 | |||||
Other assets | 167.9 | 201.5 | |||||
Subordinated notes receivable from parent | — | 5.0 | |||||
$ | 2,980.2 | $ | 3,106.5 | ||||
Liabilities and Stockholder’s Equity: | |||||||
Current liabilities | $ | 924.8 | $ | 963.1 | |||
Subordinated notes payable to parent | 7.5 | — | |||||
Long-term debt | 861.4 | 700.8 | |||||
Other liabilities | 145.2 | 168.6 | |||||
Stockholder’s equity | 1,041.3 | 1,274.0 | |||||
$ | 2,980.2 | $ | 3,106.5 |
Three Months Ended | Six Months Ended | ||||||||||||||
June 28, 2013 | June 29, 2012 | June 28, 2013 | June 29, 2012 | ||||||||||||
Net sales | $ | 1,579.5 | $ | 1,577.0 | $ | 3,070.4 | $ | 3,099.7 | |||||||
Operating income | $ | 87.0 | $ | 91.1 | $ | 169.4 | $ | 179.1 | |||||||
Income from continuing operations before income taxes | $ | 71.4 | $ | 75.7 | $ | 140.6 | $ | 153.5 | |||||||
Net income (loss) from discontinued operations | $ | 0.2 | $ | (0.1 | ) | $ | 0.1 | $ | (0.4 | ) | |||||
Net income | $ | 45.3 | $ | 47.7 | $ | 90.2 | $ | 106.9 | |||||||
Comprehensive income | $ | 33.1 | $ | 28.0 | $ | 69.8 | $ | 106.7 |
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Restructuring Charge | |||||||||||
Employee-Related Costs (a) | Facility Exit and Other Costs (b) | Total | |||||||||
Balance at December 28, 2012 | $ | 6.7 | $ | 2.4 | $ | 9.1 | |||||
Payments and other | (3.0 | ) | (0.8 | ) | (3.8 | ) | |||||
Balance at June 28, 2013 | $ | 3.7 | $ | 1.6 | $ | 5.3 |
(a) | Employee-related costs primarily consist of termination benefits provided to employees who have been involuntarily terminated. |
(b) | Facility exit and other costs primarily consist of lease termination costs. |
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Expected Stock Price Volatility | Risk-Free Interest Rate | Expected Dividend Yield | Average Expected Life | Exercise Price | Resulting Black-Scholes Value | ||||||||||||
42.0 | % | 1.1 | % | — | % | 6.12 years | $ | 68.64 | $ | 28.57 |
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Second Quarter of 2013 | ECS | W&C | OEM Supply | Corporate | Total | ||||||||||||||
Net sales | $ | 813.8 | $ | 530.6 | $ | 235.1 | $ | — | $ | 1,579.5 | |||||||||
Operating income | 42.0 | 38.1 | 5.7 | — | 85.8 | ||||||||||||||
Depreciation | 2.9 | 1.7 | 0.9 | — | 5.5 | ||||||||||||||
Amortization of intangibles | 0.2 | 1.7 | 0.4 | — | 2.3 | ||||||||||||||
Capital expenditures | 0.6 | 0.2 | 0.6 | 7.4 | 8.8 |
Second Quarter of 2012 | ECS | W&C | OEM Supply | Corporate | Total | ||||||||||||||
Net sales | $ | 820.5 | $ | 516.0 | $ | 240.5 | $ | — | $ | 1,577.0 | |||||||||
Operating income | 39.6 | 43.4 | 6.9 | — | 89.9 | ||||||||||||||
Depreciation | 2.7 | 1.5 | 1.4 | — | 5.6 | ||||||||||||||
Amortization of intangibles | 0.2 | 0.6 | 1.8 | — | 2.6 | ||||||||||||||
Capital expenditures | 1.0 | 0.2 | 0.9 | 6.5 | 8.6 |
Six Months of 2013 | ECS | W&C | OEM Supply | Corporate | Total | ||||||||||||||
Net sales | $ | 1,558.9 | $ | 1,048.4 | $ | 463.1 | $ | — | $ | 3,070.4 | |||||||||
Operating income | 76.8 | 79.4 | 10.6 | — | 166.8 | ||||||||||||||
Depreciation | 5.8 | 3.6 | 1.7 | — | 11.1 | ||||||||||||||
Amortization of intangibles | 0.4 | 3.1 | 0.7 | — | 4.2 | ||||||||||||||
Total assets | 1,239.8 | 969.6 | 452.4 | 306.8 | 2,968.6 | ||||||||||||||
Capital expenditures | 1.4 | 0.4 | 1.9 | 14.2 | 17.9 |
Six Months of 2012 | ECS | W&C | OEM Supply | Corporate | Total | ||||||||||||||
Net sales | $ | 1,599.3 | $ | 1,000.7 | $ | 499.7 | $ | — | $ | 3,099.7 | |||||||||
Operating income | 77.8 | 83.2 | 15.6 | — | 176.6 | ||||||||||||||
Depreciation | 5.3 | 3.0 | 2.8 | — | 11.1 | ||||||||||||||
Amortization of intangibles | 0.4 | 1.2 | 3.7 | — | 5.3 | ||||||||||||||
Total assets (a) | 1,272.4 | 997.9 | 461.6 | 357.7 | 3,089.6 | ||||||||||||||
Capital expenditures | 2.8 | 0.6 | 2.8 | 12.4 | 18.6 |
(a) | Total assets for 2012 are as of December 28, 2012. |
Reportable Segments | |||||||||||||||
ECS | W&C | OEM Supply | Total | ||||||||||||
Balance as of December 28, 2012 | $ | 164.1 | $ | 177.9 | $ | — | $ | 342.0 | |||||||
Acquisition related (a) | — | 2.6 | — | 2.6 | |||||||||||
Foreign currency translation | (1.2 | ) | (0.6 | ) | — | (1.8 | ) | ||||||||
Balance as of June 28, 2013 | $ | 162.9 | $ | 179.9 | $ | — | $ | 342.8 |
(a) | In the quarter ended June 28, 2013, we recorded an immaterial reclassification adjustment between intangible assets and goodwill related to the purchase price allocation related to the acquisition of Jorvex, S.A. |
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