Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Mar. 31, 2020 | Apr. 30, 2020 | |
Document Information [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | Mar. 31, 2020 | |
Document Transition Report | false | |
Entity File Number | 001-15401 | |
Entity Registrant Name | EDGEWELL PERSONAL CARE COMPANY | |
Entity Incorporation, State or Country Code | MO | |
Entity Tax Identification Number | 43-1863181 | |
Entity Address, Address Line One | 6 Research Drive | |
Entity Address, City or Town | Shelton, | |
Entity Address, State or Province | CT | |
Entity Address, Postal Zip Code | 06484 | |
City Area Code | (203) | |
Local Phone Number | 944-5500 | |
Title of 12(b) Security | Common Stock, par value $0.01 per share | |
Trading Symbol | EPC | |
Security Exchange Name | NYSE | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 54,338,877 | |
Entity Central Index Key | 0001096752 | |
Current Fiscal Year End Date | --09-30 | |
Document Fiscal Year Focus | 2020 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Earnings and Comprehensive Income - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |
Income Statement [Abstract] | ||||
Net sales | $ 523 | $ 546.7 | $ 977 | $ 1,003.8 |
Cost of products sold | 280 | 295.8 | 540.9 | 559.4 |
Gross profit | 243 | 250.9 | 436.1 | 444.4 |
Selling, general and administrative expense | 121.5 | 98.1 | 216.5 | 185.4 |
Advertising and sales promotion expense | 47 | 47.9 | 88.1 | 99.5 |
Research and development expense | 13.9 | 14 | 27.7 | 26.6 |
Restructuring charges | 6.5 | 13.5 | 12.6 | 30.6 |
Gain on sale of Infant and Pet Care business | 1.1 | 0 | (4.1) | 0 |
Interest expense associated with debt | 13.9 | 16.4 | 28.2 | 32.4 |
Other expense (income), net | 10.9 | (2.7) | 9.3 | (1.4) |
Earnings before income taxes | 28.2 | 63.7 | 57.8 | 71.3 |
Income tax provision | 8.7 | 15.5 | 15.9 | 23.5 |
Net earnings | $ 19.5 | $ 48.2 | $ 41.9 | $ 47.8 |
Basic net earnings per share | $ 0.36 | $ 0.89 | $ 0.77 | $ 0.88 |
Diluted net earnings per share | $ 0.36 | $ 0.89 | $ 0.77 | $ 0.88 |
Condensed Consolidated Statements of Comprehensive Income | ||||
Net earnings | $ 19.5 | $ 48.2 | $ 41.9 | $ 47.8 |
Other comprehensive (loss) income, net of tax | ||||
Foreign currency translation adjustments | (27.9) | (11.2) | (6.4) | (22) |
Pension and postretirement activity, net of tax | 0.8 | 0.3 | (0.7) | 0.3 |
Deferred (loss) gain on hedging activity, net of tax | 1.6 | 0.3 | 0.3 | (1) |
Total other comprehensive loss, net of tax | (25.5) | (10.6) | (6.8) | (22.7) |
Total comprehensive (loss) income | $ (6) | $ 37.6 | $ 35.1 | $ 25.1 |
Condensed Consolidated Statem_2
Condensed Consolidated Statements of Earnings and Comprehensive Income (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |
Income Statement [Abstract] | ||||
Pension and postretirement activity, tax | $ 0.5 | $ 0.2 | $ (0.1) | $ 0.3 |
Deferred (loss) gain on hedging activity, tax | $ 0.7 | $ 0.2 | $ 0.1 | $ (0.5) |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Millions | Mar. 31, 2020 | Sep. 30, 2019 |
Current assets | ||
Cash and cash equivalents | $ 308.8 | $ 341.6 |
Trade receivables, less allowance for doubtful accounts | 209.8 | 205.6 |
Inventories | 340.1 | 357.2 |
Other current assets | 130.5 | 140 |
Total current assets | 989.2 | 1,044.4 |
Property, plant and equipment, net | 372 | 396 |
Goodwill | 1,023.6 | 1,032.8 |
Other intangible assets, net | 836.2 | 912.9 |
Other assets | 87.5 | 34.8 |
Total assets | 3,308.5 | 3,420.9 |
Current liabilities | ||
Current maturities of long-term debt | 0 | 117 |
Notes payable | 17.7 | 14.4 |
Accounts payable | 190.3 | 222.8 |
Other current liabilities | 278.2 | 305.4 |
Total current liabilities | 486.2 | 659.6 |
Long-term debt | 1,098.3 | 1,097.8 |
Deferred income tax liabilities | 84.7 | 101.1 |
Other liabilities | 292 | 258.9 |
Liabilities, Total | 1,961.2 | 2,117.4 |
Shareholders’ equity | ||
Preferred shares | 0 | 0 |
Common shares | 0.7 | 0.7 |
Additional paid-in capital | 1,626.1 | 1,627.7 |
Retained earnings | 756.7 | 714.8 |
Common shares in treasury at cost | (793.5) | (803.8) |
Accumulated other comprehensive loss | (242.7) | (235.9) |
Total shareholders’ equity | 1,347.3 | 1,303.5 |
Total liabilities and shareholders’ equity | $ 3,308.5 | $ 3,420.9 |
Condensed Consolidated Balanc_2
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) $ in Millions | Mar. 31, 2020 | Sep. 30, 2019 |
Statement of Financial Position [Abstract] | ||
Allowance for doubtful accounts | $ 8.5 | $ 5.6 |
Preferred shares, par value (in usd per share) | $ 0.01 | $ 0.01 |
Preferred shares, authorized (in shares) | 10,000,000 | 10,000,000 |
Preferred shares, issued (in shares) | 0 | 0 |
Preferred shares, outstanding (in shares) | 0 | 0 |
Common shares, par value (in usd per share) | $ 0.01 | $ 0.01 |
Common shares, authorized (in shares) | 300,000,000 | 300,000,000 |
Common shares, issued (in shares) | 65,251,989 | 65,251,989 |
Common shares, outstanding (in shares) | 54,323,530 | 54,206,746 |
Treasury shares (in shares) | 10,928,459 | 11,045,243 |
Condensed Consolidated Statem_3
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Millions | 6 Months Ended | |
Mar. 31, 2020 | Mar. 31, 2019 | |
Cash Flow from Operating Activities | ||
Net earnings | $ 41.9 | $ 47.8 |
Depreciation and amortization | 44.5 | 46.4 |
Share-based compensation expense | 10.2 | 10 |
Loss on sale of assets | 0.3 | 0.9 |
Gain on sale of Infant and Pet Care business | (4.1) | 0 |
Deferred compensation payments | (8.7) | (5.2) |
Deferred income taxes | (15.5) | (0.3) |
Other, net | 8.9 | 4.5 |
Change in operating assets and liabilities | (60.3) | (136) |
Net cash from (used by) operating activities | 17.2 | (31.9) |
Cash Flow from Investing Activities | ||
Capital expenditures | (16.8) | (22.9) |
Proceeds from sale of Infant and Pet Care business | 95.8 | 0 |
Proceeds from sale of assets | 0 | 4 |
Collection of deferred purchase price on accounts receivable sold | 3.3 | 5 |
Payments for other investing activities | (1.2) | 0 |
Net Cash Provided by (Used in) Investing Activities, Total | 81.1 | (13.9) |
Cash Flow from Financing Activities | ||
Cash proceeds from debt with original maturities greater than 90 days | 50 | 253 |
Cash payments on debt with original maturities greater than 90 days | (167) | (45) |
Repayment of Term Loan | 0 | (185) |
Net increase in debt with original maturities of 90 days or less | 2.4 | 3.5 |
Net financing (outflow) inflow from the Accounts Receivable Facility | (14.4) | 2.3 |
Employee shares withheld for taxes | (1.5) | (1.5) |
Net Cash Provided by (Used in) Financing Activities, Total | (130.5) | 27.3 |
Effect of exchange rate changes on cash | (0.6) | (3.3) |
Cash and cash equivalents, beginning of period | 341.6 | 266.4 |
Cash and cash equivalents, end of period | $ 308.8 | $ 244.6 |
Condensed Consolidated Statem_4
Condensed Consolidated Statement of Changes in Shareholders' Equity Statement - USD ($) $ in Millions | Total | Common shares | Treasury shares | Additional paid-in capital | Retained earnings | Accumulated other comprehensive loss |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Treasury shares (in shares) | (11,200,000) | |||||
Common shares, issued (in shares) | 65,200,000 | |||||
Total shareholders' equity at Sep. 30, 2018 | $ 1,744.6 | $ 0.7 | $ (819.2) | $ 1,628.3 | $ 1,083.1 | $ (148.3) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net earnings | 47.8 | 47.8 | ||||
Foreign currency translation adjustments | (22) | (22) | ||||
Pension and postretirement activity, net of tax | 0.3 | (0.3) | ||||
Deferred (loss) gain on hedging activity, net of tax | (1) | (1) | ||||
Impact of ASU 2016-16 | 3.9 | 3.9 | ||||
Activity under share plans (in shares) | 100,000 | |||||
Activity under share plans (in usd) | 8.5 | $ 6.8 | 1.7 | 0 | ||
Total shareholders' equity at Mar. 31, 2019 | 1,782.1 | $ 0.7 | $ (812.4) | 1,630 | 1,134.8 | (171) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Treasury shares (in shares) | (11,100,000) | |||||
Common shares, issued (in shares) | 65,200,000 | |||||
Total shareholders' equity at Dec. 31, 2018 | 1,739.3 | $ 0.7 | $ (812.6) | 1,625 | 1,086.6 | (160.4) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net earnings | 48.2 | 48.2 | ||||
Foreign currency translation adjustments | (11.2) | (11.2) | ||||
Pension and postretirement activity, net of tax | 0.3 | (0.3) | ||||
Deferred (loss) gain on hedging activity, net of tax | 0.3 | 0.3 | ||||
Activity under share plans (in shares) | 0 | |||||
Activity under share plans (in usd) | 5.2 | $ 0.2 | 5 | 0 | ||
Total shareholders' equity at Mar. 31, 2019 | $ 1,782.1 | $ 0.7 | $ (812.4) | 1,630 | 1,134.8 | (171) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Treasury shares (in shares) | (11,100,000) | |||||
Common shares, issued (in shares) | 65,200,000 | |||||
Treasury shares (in shares) | 11,045,243 | (11,000,000) | ||||
Common shares, issued (in shares) | 65,251,989 | 65,200,000 | ||||
Total shareholders' equity at Sep. 30, 2019 | $ 1,303.5 | $ 0.7 | $ (803.8) | 1,627.7 | 714.8 | (235.9) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net earnings | 41.9 | 41.9 | ||||
Foreign currency translation adjustments | (6.4) | (6.4) | ||||
Pension and postretirement activity, net of tax | (0.7) | (0.7) | ||||
Deferred (loss) gain on hedging activity, net of tax | 0.3 | 0.3 | ||||
Activity under share plans (in shares) | 100,000 | |||||
Activity under share plans (in usd) | 8.7 | $ 10.3 | (1.6) | 0 | ||
Total shareholders' equity at Mar. 31, 2020 | 1,347.3 | $ 0.7 | $ (793.5) | 1,626.1 | 756.7 | (242.7) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Treasury shares (in shares) | (10,900,000) | |||||
Common shares, issued (in shares) | 65,200,000 | |||||
Total shareholders' equity at Dec. 31, 2019 | 1,348.1 | $ 0.7 | $ (795.3) | 1,622.7 | 737.2 | (217.2) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Net earnings | 19.5 | 19.5 | ||||
Foreign currency translation adjustments | (27.9) | (27.9) | ||||
Pension and postretirement activity, net of tax | 0.8 | 0.8 | ||||
Deferred (loss) gain on hedging activity, net of tax | 1.6 | 1.6 | ||||
Activity under share plans (in shares) | 0 | |||||
Activity under share plans (in usd) | 5.2 | $ 1.8 | 3.4 | 0 | ||
Total shareholders' equity at Mar. 31, 2020 | $ 1,347.3 | $ 0.7 | $ (793.5) | $ 1,626.1 | $ 756.7 | $ (242.7) |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||||
Treasury shares (in shares) | 10,928,459 | (10,900,000) | ||||
Common shares, issued (in shares) | 65,251,989 | 65,200,000 |
Background and Basis of Present
Background and Basis of Presentation | 6 Months Ended |
Mar. 31, 2020 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Background and Basis of Presentation | Background and Basis of Presentation Background Edgewell Personal Care Company, and its subsidiaries (collectively, “Edgewell” or the “Company”), is one of the world’s largest manufacturers and marketers of personal care products in the wet shave, sun and skin care, and feminine care categories. Edgewell operates in more than 20 countries with extensive retail reach across 50 markets. The Company conducts its business in the following three segments: • Wet Shave consists of products sold under the Schick®, Wilkinson Sword®, Edge, Skintimate®, Shave Guard® and Personna® brands, as well as non-branded products. The Company’s wet shave products include razor handles and refillable blades, disposable shave products, and shaving gels and creams. • Sun and Skin Care consists of Banana Boat® and Hawaiian Tropic® sun care products, Jack Black® and Bulldog® men’s skin care products, and Wet Ones® wipes. • Feminine Care includes tampons, pads, and liners sold under the Playtex Gentle Glide® and Sport®, Stayfree®, Carefree®, and o.b.® brands. Through December 2019, the Company also conducted business in its All Other segment which included infant care products, such as bottles, cups, and pacifiers, sold under the Playtex®, OrthoPro® and Binky® brand names, as well as the Diaper Genie® and Litter Genie® disposal systems. The Company completed the sale of the Infant and Pet Care business in December 2019. Basis of Presentation The accompanying unaudited Condensed Consolidated Financial Statements include the accounts of the Company and its controlled subsidiaries and have been prepared in accordance with United States (“U.S.”) generally accepted accounting principles (“GAAP”), under the rules and regulations of the U.S. Securities and Exchange Commission (the “SEC”). The preparation of the unaudited Condensed Consolidated Financial Statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amount of assets and liabilities, disclosure of contingent assets and liabilities and the reported amounts of revenues and expenses. Actual results may differ materially from those estimates. All intercompany balances and transactions have been eliminated in consolidation and, in the opinion of management, all normal recurring adjustments considered necessary for a fair presentation have been included in the interim results reported. The fiscal year-end balance sheet data was derived from audited consolidated financial statements, but do not include all of the annual disclosures required by GAAP; accordingly, these unaudited Condensed Consolidated Financial Statements should be read in conjunction with the Company’s audited annual consolidated financial statements included in its Annual Report on Form 10-K filed with the SEC on November 26, 2019. Recently Adopted Accounting Pronouncements. In February 2016, the Financial Account Standards Board (“FASB”) issued ASU 2016-02, which amends existing lease accounting guidance to require recognition of lease assets and lease liabilities on the balance sheet for leases previously classified as operating leases. Additionally, this update requires qualitative disclosure along with specific quantitative disclosures. The Company adopted the standard effective October 1, 2019, using the modified retrospective approach with no restatement of prior period amounts. As a result of adoption, the Company recognized leased right of use assets and liabilities of $57.4 and $57.5, respectively. The impact to the Consolidated Statement of Earnings and Consolidated Statement of Cash Flows was not material for the first six months of fiscal 2020. Refer to Note 8 in the Notes to the Condensed Consolidated Financial Statements for further discussion. In August 2017, the FASB issued ASU 2017-12, which eliminates the requirement to separately measure and report hedge ineffectiveness and generally requires, for qualifying hedges, the entire change in the fair value of a hedging instrument to be presented in the same income statement line as the hedged item. The guidance also modifies the accounting for components excluded from the assessment of hedge effectiveness, eases documentation and assessment requirements and modifies certain disclosure requirements. The Company adopted the standard effective October 1, 2019. The impact from adoption of this new accounting pronouncement was not material to the Company's financial statements for the first six months of fiscal 2020. In June 2018, the FASB issued ASU 2018-07, which simplifies the treatment of share-based payment transactions used in acquiring goods and services from non-employees. The amendments note that measurement of share-based payments used to acquire goods or services should be valued at the grant-date fair value. The grant date is defined as the date at which the grantor and grantee reach a mutual understanding of the terms and conditions of the award. Finally, any awards containing a performance condition should be valued considering the probability of satisfying the necessary performance conditions consistent with employee share-based awards. The Company adopted the standard effective October 1, 2019. The impact from adopting this guidance was not material to the Company's financial statements for the first six months of fiscal 2020. Recently Issued Accounting Pronouncements. In June 2016, the FASB issued ASU 2016-13 intended to improve financial reporting by requiring timelier recording of credit losses on loans and other financial instruments held by financial institutions and other organizations. The new guidance applies to all financial instruments, including trade receivables, and requires the measurement of all expected credit losses for financial assets held at a reporting date to be based on historical experience, current conditions and reasonable and supportable forecasts. Previous guidance did not include forward-looking information. The update will be effective for the Company beginning October 1, 2020 and early adoption is permitted for fiscal years beginning after December 15, 2018. The Company is in the process of evaluating the impact, if any, this guidance will have on its financial statements but does not expect it will be material and will be dependent on the credit quality of the trade receivables outstanding at the date of adoption. The Company evaluates the creditworthiness of customers when negotiating contracts and, as trade receivables are short term in nature, the timing between recognition of a credit loss under existing guidance and the new guidance is not expected to differ materially. In August 2018, the FASB issued ASU 2018-13 adjusting the disclosure requirements for fair value measurements. The guidance updates the disclosure requirements regarding leveling of fair value assets and the valuation of Level 3 fair value measurements. The standard will be effective for the Company beginning October 1, 2020 and early adoption is permitted. The Company is in the process of evaluating the impact, if any, this guidance will have on its financial statements but does not expect it will result in a material change to the financial statements and related disclosures. In August 2018, the FASB issued ASU 2018-14, which modifies the disclosure requirements for defined benefit pension plans and other post retirement plans. The guidance removes disclosures that are no longer considered cost beneficial, clarifies the specific requirements of disclosures and adds disclosure requirements identified as relevant. The new standard will be effective for the Company beginning October 1, 2020 and early adoption is permitted. The Company is in the process of evaluating the impact, if any, this guidance will have on its financial statement but does not expect it will result in a material change to the financial statements. In August 2018, the FASB issued ASU 2018-15, which aligns the requirements for capitalizing implementation costs incurred in a hosting arrangement that is a service contract with the requirements for capitalizing implementation costs incurred to develop or obtain internal-use software. The amendments in this standard require an entity that is the customer in a hosting arrangement to follow the guidance on internal-use software to determine which implementation costs to capitalize and which costs to expense. The standard also requires a customer to expense the capitalized implementation costs of a hosting arrangement over the term of the hosting arrangement. The new guidance requires an entity to present the expense related to the capitalized implementation costs in the same line item in the statement of income as the fees associated with the hosting element of the arrangement and classify payments for capitalized implementation costs in the statement of cash flows in the same manner as payments made for fees associated with the hosting element. The entity is also required to present the capitalized implementation costs in the statement of financial position in the same line item that a prepayment for the fees of the associated hosting arrangement would be presented. The guidance is effective for the Company beginning October 1, 2020 and early adoption is permitted. The Company is in the process of evaluating the impact, if any, this guidance will have on its financial statements. In December 2019, the FASB issued ASU 2019-12, which eliminates certain exceptions related to the approach for intra-period tax allocation, the methodology for calculating income taxes in an interim period when interim loss exceeds anticipated loss for the year, and the recognition of deferred tax liabilities for outside basis differences related to changes in ownership of equity method investments and foreign subsidiaries. The guidance also simplifies aspects of accounting for franchise taxes and enacted changes in tax laws or rates and clarifies the accounting for transactions that result in a step-up in the tax basis of goodwill. The standard will be effective for the Company beginning October 1, 2021, with early adoption permitted. The Company is in the process of evaluating the impact, if any, this guidance will have on its financial statements. |
Divestitures
Divestitures | 6 Months Ended |
Mar. 31, 2020 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Disposal group | Divestitures Sale of Infant and Pet Care Business On December 17, 2019, the Company completed the sale of its Infant and Pet Care business included in the All Other segment for $122.5, which included consideration for providing services to the purchaser for up to one year under a transition services agreement. The Company received proceeds of $107.5, which includes the consideration for providing support under the transition services agreement, and the remaining sales price receivable includes $7.5 reported in current assets and $5.0 reported in other assets as of March 31, 2020. Total assets included in the sale were comprised of $18.8 of inventory, $3.6 of property, plant and equipment, and $77.8 of goodwill and intangible assets. The sale of the Infant and Pet Care business resulted in a gain of $4.1, net of expenses incurred to facilitate the closing of the transaction and in support of the transition services agreement. |
Restructuring Charges
Restructuring Charges | 6 Months Ended |
Mar. 31, 2020 | |
Restructuring Charges [Abstract] | |
Restructuring Charges | Restructuring Charges Project Fuel In February 2018, the Company announced Project Fuel, an enterprise-wide transformational initiative that is designed to address all aspects of the Company’s business and cost structure, simplifying and transforming the organization, structure, and key processes that will enable the Company to achieve its desired future state operations. The Company has incurred costs and realized savings for Project Fuel beginning in fiscal 2018 through the second quarter of fiscal 2020 and expects to incur additional costs and realize additional savings through fiscal 2021. The Company does not include Project Fuel restructuring costs in the results of its reportable segments. The estimated impact of allocating such charges to segment results for the three and six months ended March 31, 2020 and 2019 would have been as follows: Three Months Ended March 31, 2020 Wet Sun and Skin Care Feminine Care Corporate Total Project Fuel Severance and related benefit costs $ 0.2 $ — $ — $ 0.6 0.8 Asset impairment and accelerated depreciation 1.0 — — — 1.0 Consulting, project implementation and management, and other exit costs 3.0 0.2 0.2 7.2 10.6 Total Restructuring $ 4.2 $ 0.2 $ 0.2 $ 7.8 $ 12.4 Six Months Ended March 31, 2020 Wet Shave Sun and Skin Care Feminine Care Corporate Total Project Fuel Severance and related benefit costs $ 0.2 $ — $ — $ 1.9 2.1 Asset impairment and accelerated depreciation 1.0 — — — 1.0 Consulting, project implementation and management, and other exit costs 5.8 0.2 0.2 11.1 17.3 Total Restructuring $ 7.0 $ 0.2 $ 0.2 $ 13.0 $ 20.4 Three Months Ended March 31, 2019 Wet Sun and Skin Care Feminine Care All Other Corporate Total Project Fuel Severance and related benefit costs $ 4.4 $ 1.7 $ 0.9 $ 0.3 $ 1.8 $ 9.1 Asset impairment and accelerated depreciation 0.5 — — — — 0.5 Consulting, project implementation and management, and other exit costs — — — — 5.8 5.8 Total Restructuring $ 4.9 $ 1.7 $ 0.9 $ 0.3 $ 7.6 $ 15.4 Six Months Ended March 31, 2019 Wet Shave Sun and Skin Care Feminine Care All Other Corporate Total Project Fuel Severance and related benefit costs $ 11.7 $ 2.2 $ 1.2 $ 0.4 $ 2.8 $ 18.3 Asset impairment and accelerated depreciation 0.5 — — — 0.5 1.0 Consulting, project implementation and management, and other exit costs 2.3 — — — 12.3 14.6 Total Restructuring $ 14.5 $ 2.2 $ 1.2 $ 0.4 $ 15.6 $ 33.9 Pre-tax Selling, General and Administrative expense (“SG&A”) of $5.8 and $7.7 for the three and six months ended March 31, 2020, respectively, and $1.9 and $3.3 for the three and six months ended March 31, 2019, respectively, associated with certain information technology enablement expenses and compensation expenses related to Project Fuel were included in Consulting, project implementation and management, and other exit costs. Pre-tax Cost of products sold of $0.1 for the three and six months ended March 31, 2020, related to inventory write-offs associated with Project Fuel, were included in Asset impairment and accelerated depreciation. The following table summarizes the Restructuring activities and related accrual (excluding certain obsolescence charges related to the restructuring) for fiscal 2020: Utilized October 1, 2019 Charge to Other (1) Cash Non-Cash March 31, Restructuring Severance and related benefit costs $ 8.2 $ 2.1 $ (0.1) $ (6.1) $ — $ 4.1 Asset impairment and accelerated depreciation — 1.0 — — (1.0) — Consulting, project implementation and management, and other exit costs 1.3 17.3 — (17.6) — 1.0 Total Restructuring $ 9.5 $ 20.4 $ (0.1) $ (23.7) $ (1.0) $ 5.1 (1) Includes the impact of currency translation. |
Income Taxes
Income Taxes | 6 Months Ended |
Mar. 31, 2020 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income Taxes For the three and six months ended March 31, 2020, the Company had income tax expense of $8.7 and $15.9, respectively, on Earnings before income taxes of $28.2 and $57.8, respectively. The effective tax rate for the three and six months ended March 31, 2020 was 30.6% and 27.4%, respectively. The difference between the federal statutory rate and the effective rate is primarily due to the unfavorable impact of the sale of the Infant and Pet Care business. For the three and six months ended March 31, 2019, the Company had income tax expense of $15.5 and $23.5, respectively, on Earnings before income taxes of $63.7 and $71.3, respectively. The effective tax rate for the three and six months ended March 31, 2019 was 24.4% and 33.0%, respectively. The difference between the federal statutory rate and the effective rate is primarily due to a $4.7 net transitional charge related to the Tax Cuts and Jobs Act. The rate was also unfavorably impacted by $33.9 of restructuring and other related costs in lower tax rate jurisdictions and unfavorable tax adjustments, including the impact of equity compensation. |
Earnings per Share
Earnings per Share | 6 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Earnings per Share | Earnings per Share Basic earnings per share is based on the weighted-average number of common shares outstanding during the period. Diluted earnings per share is based on the number of shares used for the basic earnings per share calculation, adjusted for the dilutive effect of share options and restricted share equivalent (“RSE”) awards. The following is the reconciliation between the number of weighted-average shares used in the basic and diluted earnings per share calculation: Three Months Ended Six Months Ended 2020 2019 2020 2019 Basic weighted-average shares outstanding 54.3 54.1 54.3 54.1 Effect of dilutive securities: RSE awards 0.2 0.2 0.2 0.2 Total dilutive securities 0.2 0.2 0.2 0.2 Diluted weighted-average shares outstanding 54.5 54.3 54.5 54.3 For the three and six months ended March 31, 2020, the calculation of diluted weighted-average shares outstanding excludes 0.7 of share options and 0.1 of RSE awards because the effect of including these awards was anti-dilutive. For the three and six months ended March 31, 2019, the calculation of diluted weighted-average shares outstanding excludes 0.5 of share options and 0.1 of RSE awards because the effect of including these awards was anti-dilutive. |
Goodwill and Intangible Assets
Goodwill and Intangible Assets | 6 Months Ended |
Mar. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Goodwill and Intangible Assets | Goodwill and Intangible Assets The following table sets forth goodwill by segment: Wet Sun and Skin Feminine All Total Gross balance at October 1, 2019 $ 960.3 $ 228.3 $ 207.0 $ 69.6 $ 1,465.2 Accumulated goodwill impairment (369.0) (2.0) — (61.4) (432.4) Net balance at October 1, 2019 $ 591.3 $ 226.3 $ 207.0 $ 8.2 $ 1,032.8 Changes in the six-month period ended March 31, 2020 Infant and Pet Care divestiture — — — (8.2) (8.2) Cumulative translation adjustment 1.2 0.2 (2.4) — (1.0) Gross balance at March 31, 2020 $ 961.5 $ 228.5 $ 204.6 $ 61.4 $ 1,456.0 Accumulated goodwill impairment (369.0) (2.0) — (61.4) (432.4) Net balance at March 31, 2020 $ 592.5 $ 226.5 $ 204.6 $ — $ 1,023.6 March 31, 2020 September 30, 2019 Gross Accumulated Net Gross Accumulated Net Trade names and brands $ 206.5 $ 40.0 $ 166.5 $ 206.4 $ 35.0 $ 171.4 Technology and patents 76.1 74.6 1.5 78.5 76.4 2.1 Customer related and other 175.3 103.7 71.6 176.0 100.9 75.1 Total amortizable intangible assets $ 457.9 $ 218.3 $ 239.6 $ 460.9 $ 212.3 $ 248.6 Amortization expense was $4.2 and $8.5 for the three and six months ended March 31, 2020, respectively, and $4.5 and $9.0 for the three and six months ended March 31, 2019, respectively. Estimated amortization expense for amortizable intangible assets for the remainder of fiscal 2020 and for fiscal 2021, 2022, 2023, 2024, and 2025 is $8.4, $16.3, $16.2, $16.2, $16.1, and $16.1, respectively, and $150.3 thereafter. The Company had indefinite-lived intangible assets of $596.6 ($178.7 in Wet Shave, $388.0 in Sun and Skin Care, $29.9 in Feminine Care, and $0.0 in All Other) at March 31, 2020, a decrease of $67.7 from September 30, 2019, which was primarily the result of the sale of the Diaper Genie indefinite lived intangible asset, offset by foreign currency fluctuations. The Company had indefinite-lived trade names and brands of $664.3 ($177.7 in Wet Shave, $387.9 in Sun and Skin Care, $29.9 in Feminine Care, and $68.8 in All Other) at September 30, 2019. Goodwill and intangible assets deemed to have an indefinite life are not amortized but are instead reviewed annually for impairment of value or when indicators of a potential impairment are present. The Company’s annual impairment testing date is July 1. The Company continuously monitors events which could trigger an interim impairment analysis, such as changing business conditions and environmental factors, which included the impact of the COVID-19 pandemic for the quarter ended March 31, 2020. The Company determined there was no triggering event requiring an interim impairment analysis in the quarter ended March 31, 2020. However, the duration and severity of COVID-19 could result in future impairment charges as a prolonged pandemic could impact the results of the Company’s operations and changes to the assumptions utilized in the determination of the estimated fair value of the Company’s goodwill and indefinite-lived intangible assets including long term growth rates and discount rates. This could be significant enough that an interim impairment analysis may indicate that carrying amounts of goodwill and other intangible assets require adjustment or that remaining useful lives should be revised. Refer to the sensitivity analysis in Management's Discussion and Analysis in the Company’s Annual Report on Form 10-K filed with the SEC on November 26, 2019. |
Supplemental Balance Sheet Info
Supplemental Balance Sheet Information | 6 Months Ended |
Mar. 31, 2020 | |
Supplemental Balance Sheet Information [Abstract] | |
Supplemental Balance Sheet Information | Supplemental Balance Sheet Information March 31, September 30, Inventories Raw materials and supplies $ 55.3 $ 55.1 Work in process 64.6 66.5 Finished products 220.2 235.6 Total inventories $ 340.1 $ 357.2 Other Current Assets Miscellaneous receivables $ 13.8 $ 14.9 Inventory returns receivable 0.6 4.9 Prepaid expenses 67.9 65.0 Value added tax collectible from customers 20.1 23.0 Income taxes receivable 15.5 29.1 Other 12.6 3.1 Total other current assets $ 130.5 $ 140.0 Property, Plant and Equipment Land $ 18.8 $ 18.7 Buildings 137.5 137.4 Machinery and equipment 986.0 992.3 Capitalized software costs 46.1 47.8 Construction in progress 34.1 40.9 Total gross property, plant and equipment 1,222.5 1,237.1 Accumulated depreciation and amortization (850.5) (841.1) Total property, plant and equipment, net $ 372.0 $ 396.0 Other Current Liabilities Accrued advertising, sales promotion and allowances $ 42.3 $ 51.9 Accrued trade allowances 24.9 26.2 Accrued salaries, vacations and incentive compensation 42.8 51.5 Income taxes payable 15.6 11.5 Returns reserve 32.6 60.4 Restructuring reserve 5.1 9.5 Value added tax payable 7.3 3.6 Deferred compensation 6.6 10.4 Short term lease obligation 10.8 — Customer advance payments 1.9 1.7 Other 88.3 78.7 Total other current liabilities $ 278.2 $ 305.4 Other Liabilities Pensions and other retirement benefits $ 147.5 $ 149.8 Deferred compensation 25.1 30.3 Long term lease obligation 38.4 — Other non-current liabilities 81.0 78.8 Total other liabilities $ 292.0 $ 258.9 |
Leases
Leases | 6 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Lessee, Operating Leases | Leases The Company adopted ASU 2016-02 on October 1, 2019. The Company has elected to utilize the package of practical expedients permitted under the transition guidance which allows it to carryforward its historical lease classification, its assessment on whether a contract was or contains a lease, and its assessment of initial direct costs for any leases that existed prior to October 1, 2019. Additionally, the Company has elected as an accounting policy not to separate non-lease components from lease components and, instead, account for these components as a single lease component. The Company has made an accounting policy election not to recognize right of use (“ROU”) assets and lease liabilities for leases that, at the commencement date, are for 12 months or fewer. For leases that do not provide an implicit rate, the Company uses its secured incremental borrowing rate, based on the information available for leases, including the lease term and interest rate environment in the country in which the lease exists, to calculate the present value of the future lease payments. A lease is defined as a contract, or part of a contract, that conveys the right to control the use of identified property, plant, or equipment over a contracted period in exchange for payment. The Company evaluates if an arrangement is a lease at the inception date for the agreement. For operating leases entered into prior to October 1, 2019, the ROU assets and operating lease liabilities are recognized in the balance sheet based on the present value of the remaining future minimum payments over the lease term from the implementation date. Certain leases include an option to either renew or terminate the lease. For purposes of calculating lease liabilities, these options are included within the lease term when it has become reasonably certain that the Company will exercise such options. Leases entered into subsequent to the implementation date calculate the operating lease ROU asset and operating lease liabilities based on the present value of minimum payments over the lease term at the commencement date of the lease. The Company leases certain offices and manufacturing facilities, warehouses, employee vehicles, and certain manufacturing related equipment. Leases with an initial term of 12 months or fewer are not recorded on the Condensed Consolidated Balance Sheet. All recorded leases are classified as operating leases and lease expense is recognized on a straight-line basis over the lease term. A summary of the company's lease information is as follows: March 31, Assets Classification Right of use assets Other assets $ 48.8 Liabilities Current lease liabilities Other current liabilities $ 10.8 Long-term lease liabilities Other liabilities 38.4 Total lease liabilities $ 49.2 Other information Weighted-average remaining lease term (years) 11 Weighted-average incremental borrowing rate 6.8 % Three Months Ended March 31, 2020 Six Months Ended March 31, 2020 Statement of Income Lease cost (1) $ 3.4 $ 7.1 Other information Leased assets obtained in exchange for new lease liabilities $ 0.5 $ 0.6 Cash paid for amounts included in the measurement of lease liabilities $ 3.2 $ 7.0 (1) Lease expense is included in cost of products sold or SG&A expenses based on the nature of the lease. Short-term lease expense is excluded from this amount and is not material. The Company's future lease payments including reasonable assured renewal options under lease agreements are as follows: Operating Leases Remainder of fiscal 2020 $ 7.1 2021 11.1 2022 8.3 2023 6.9 2024 5.5 2025 and thereafter 40.4 Total future minimum lease commitments 79.3 Less: Imputed Interest (30.1) Present value of lease liabilities $ 49.2 At September 30, 2019, the aggregate future minimum rental commitments under all non-cancelable operating lease agreements were as follows: Operating Leases 2020 $ 13.6 2021 10.5 2022 7.4 2023 5.9 2024 4.6 2025 and thereafter 12.5 Total future minimum lease commitments $ 54.5 |
Accounts Receivable Facility
Accounts Receivable Facility | 6 Months Ended |
Mar. 31, 2020 | |
Transfers and Servicing [Abstract] | |
Accounts receivable facility | Accounts Receivable Facility On September 15, 2017, the Company entered into a $150 uncommitted master accounts receivable purchase agreement with The Bank of Tokyo-Mitsubishi UFJ, Ltd., New York Branch, as the purchaser (the “Accounts Receivable Facility”). Transfers under the Accounts Receivable Facility are accounted for as sales of receivables, resulting in the receivables being de-recognized from the Consolidated Balance Sheet. The purchaser assumes the credit risk at the time of sale and has the right at any time to assign, transfer, or participate any of its rights under the purchased receivables to another bank or financial institution. The purchase and sale of receivables under the Accounts Receivable Facility is intended to be an absolute and irrevocable transfer without recourse by the purchaser to the Company for the creditworthiness of any obligor. The Company continues to have collection and servicing responsibilities for the receivables sold and receives separate compensation for their servicing. The compensation received is considered acceptable servicing compensation and, as such, the Company does not recognize a servicing asset or liability. As of March 31, 2020, the discount rate used to determine the purchase price for the subject receivables is based upon LIBOR plus a margin applicable to the specified obligor. |
Debt
Debt | 6 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Debt | Debt The detail of long-term debt was as follows: March 31, September 30, Senior notes, fixed interest rate of 4.7%, due 2021 $ 600.0 $ 600.0 Senior notes, fixed interest rate of 4.7%, due 2022 500.0 500.0 U.S. revolving credit facility due 2020 — 117.0 Total long-term debt, including current maturities 1,100.0 1,217.0 Less current portion — 117.0 Less unamortized debt issuance costs and discount (1) (2) 1.7 2.2 Total long-term debt $ 1,098.3 $ 1,097.8 (1) At March 31, 2020, the balance for the senior notes due 2021 and the senior notes due 2022 are reflected net of debt issuance costs of $0.5 and $0.9, respectively. At September 30, 2019, the balance for the senior notes due 2021 and the senior notes due 2022 are reflected net of debt issuance costs of $0.8 and $1.0, respectively. (2) At March 31, 2020 and September 30, 2019, the balance for the senior notes due 2022 was reflected net of discount of $0.3 and $0.4, respectively. The Company had outstanding variable-rate international borrowings, recorded in Notes payable, of $17.7 and $14.4 as of March 31, 2020 and September 30, 2019, respectively. Replacement of Credit Agreement On April 3, 2020 (the “Closing Date”), the Company closed its new senior secured revolving credit facility in an aggregate principal amount of $425 (the “Revolving Credit Facility”) dated March 28, 2020, by and among, the Company and certain subsidiaries of the Company, and Bank of America, N.A. as administrative agent and collateral agent ("BofA"), MUFG Bank, Ltd., as syndication agent (“MUFG”), TD Securities (USA) LLC, as joint lead arranger (“TD”), and the several lenders from time to time party thereto (together with BofA, MUFG, and TD, the "Lenders") (the "Credit Agreement"). Interest on any borrowings under the Revolving Credit Facility must be paid monthly, bi-monthly or quarterly depending on the interest rate. Any outstanding amounts under the Revolving Credit Facility must be repaid on or before April 3, 2025. Under the Credit Agreement, certain of the Company’s subsidiaries guarantee the Company’s payment and performance obligations. The Revolver will include a letter of credit subfacility of up to $70 and will provide the Company with the ability to incur certain amounts of additional incremental loans in the future, subject to the satisfaction of certain conditions. The Revolving Credit Facility, expandable under an accordion feature, will provide for a five-year revolving line of credit and will bear interest at a range of 1.50% - 2.25% over LIBOR, depending on the net debt leverage level of the Company. Effective as of April 3, 2020, and in connection with the Credit Agreement, the Company terminated that certain senior unsecured revolving credit agreement dated as of June 1, 2015, as amended, supplemented or modified from time to time among the Company, as borrower, JPMorgan Chase Bank, N.A., as administrative agent, and the other parties thereto, and the related Subsidiary Guaranty Agreement dated as of June 30, 2015 (“Prior Revolving Credit Facility”). The Company did not have any outstanding borrowings at the termination date and no early termination penalties were incurred. |
Retirement Plans
Retirement Plans | 6 Months Ended |
Mar. 31, 2020 | |
Retirement Benefits [Abstract] | |
Retirement Plans | Retirement PlansThe Company has several defined benefit pension plans covering employees in the U.S. and certain employees in other countries, which are included in the information presented below. The plans provide retirement benefits based on years of service and earnings. The Company also sponsors or participates in several other non-U.S. pension and postretirement arrangements, including various retirement and termination benefit plans, some of which are required by local law or coordinated with government-sponsored plans, which are not significant in the aggregate and, therefore, are not included in the information presented below. The Company’s net periodic pension and postretirement costs for these plans for the three and six months ended March 31 were as follows: Three Months Ended Six Months Ended 2020 2019 2020 2019 Service cost $ 1.0 $ 0.8 $ 2.1 $ 1.5 Interest cost 3.5 4.7 6.9 9.4 Expected return on plan assets (5.7) (6.3) (11.5) (12.6) Recognized net actuarial loss 2.3 1.0 4.6 2.0 Settlement loss recognized 0.2 — 0.4 — Net periodic cost $ 1.3 $ 0.2 $ 2.5 $ 0.3 The service cost component of the net periodic cost associated with the Company’s retirement plans is recorded to Cost of products sold and SG&A on the Condensed Consolidated Statement of Earnings. The remaining net periodic cost is recorded to Other (income) expense, net on the Condensed Consolidated Statement of Earnings. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Loss | 6 Months Ended |
Mar. 31, 2020 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Accumulated Other Comprehensive Loss | Accumulated Other Comprehensive (Loss) Income The following table presents the changes in accumulated other comprehensive (loss) income (“AOCI”), net of tax, by component: Foreign Pension and Hedging Total Balance at October 1, 2019 $ (77.3) $ (159.8) $ 1.2 $ (235.9) OCI before reclassifications (1) (6.4) (4.3) 1.4 (9.3) Reclassifications to earnings — 3.6 (1.1) 2.5 Balance at March 31, 2020 $ (83.7) $ (160.5) $ 1.5 $ (242.7) Foreign Pension and Hedging Total Balance at October 1, 2018 $ (40.6) $ (110.3) $ 2.6 $ (148.3) OCI before reclassifications (1) (22.0) (1.2) 1.1 (22.1) Reclassifications to earnings — 1.5 (2.1) (0.6) Balance at March 31, 2019 $ (62.6) $ (110.0) $ 1.6 $ (171.0) (1) OCI is defined as other comprehensive income (loss). The following table presents the reclassifications out of AOCI: Three Months Ended Six Months Ended Affected Line Item in the Details of AOCI Components 2020 2019 2020 2019 Gain / (Loss) on cash flow hedges Foreign exchange contracts $ 0.7 $ 1.3 $ 1.6 $ 3.1 Other (income) expense, net 0.7 1.3 1.6 3.1 Total before tax 0.2 0.4 0.5 1.0 Income tax provision 0.5 0.9 1.1 2.1 Net of tax Amortization of defined benefit pension and postretirement items Actuarial losses $ (2.3) $ (1.0) $ (4.6) $ (2.0) (1) Settlements (0.2) — (0.4) — (2.5) (1.0) (5.0) (2.0) Total before tax (0.7) (0.2) (1.4) (0.5) Income tax provision (1.8) (0.8) (3.6) (1.5) Net of tax Total reclassifications for the period $ (1.3) $ 0.1 $ (2.5) $ 0.6 Net of tax (1) These AOCI components are included in the computation of net periodic cost (benefit). See Note 11 of Notes to Condensed Consolidated Financial Statements. |
Financial Instruments and Risk
Financial Instruments and Risk Management | 6 Months Ended |
Mar. 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Financial Instruments and Risk Management | Financial Instruments and Risk Management In the course of business, the Company enters into contractual arrangements (also referred to as derivatives) to reduce its exposure to foreign currency. The Company has master netting agreements with all of its counterparties that allow for the settlement of contracts in an asset position with contracts in a liability position in the event of default. The Company manages counterparty risk through the utilization of investment grade commercial banks, diversification of counterparties, and its counterparty netting arrangements. The section below outlines the types of derivatives that existed at March 31, 2020 and September 30, 2019, as well as the Company’s objectives and strategies for holding derivative instruments. Foreign Currency Risk A significant share of the Company’s sales is tied to currencies other than the U.S. dollar, the Company’s reporting currency. As such, a weakening of currencies relative to the U.S. dollar can have a negative impact on reported earnings. Conversely, strengthening of currencies relative to the U.S. dollar can improve reported results. The primary currencies to which the Company is exposed include the euro, the Japanese yen, the British pound, the Canadian dollar, and the Australian dollar. Additionally, the Company’s foreign subsidiaries enter into internal and external transactions that create non-functional currency balance sheet positions at the foreign subsidiary level. These exposures are generally the result of intercompany purchases, intercompany loans and, to a lesser extent, external purchases and are revalued in the foreign subsidiary’s local currency at the end of each period. Changes in the value of the non-functional currency balance sheet positions in relation to the foreign subsidiary’s local currency results in an exchange gain or loss recorded in Other expense (income), net. The primary currency to which the Company’s foreign subsidiaries are exposed is the U.S. dollar. Cash Flow Hedges At March 31, 2020, the Company maintained a cash flow hedging program related to foreign currency risk. These derivative instruments have a high correlation to the underlying exposure being hedged and have been deemed highly effective by the Company for accounting purposes in offsetting the associated risk. The Company entered into a series of forward currency contracts to hedge cash flow uncertainty associated with currency fluctuations. These transactions are accounted for as cash flow hedges. The Company had unrealized pre-tax gains of $2.1 and $1.7 at March 31, 2020 and September 30, 2019, respectively, on these forward currency contracts, which are accounted for as cash flow hedges and included in AOCI. Assuming foreign exchange rates versus the U.S. dollar remain at March 31, 2020 levels over the next 12 months, most of the pre-tax gain included in AOCI at March 31, 2020 is expected to be included in Other (income) expense, net. Contract maturities for these hedges extend into fiscal 2020. At March 31, 2020, there were 64 open foreign currency contracts with a total notional value of $131.4. Derivatives not Designated as Hedges The Company entered into foreign currency derivative contracts which are not designated as cash flow hedges for accounting purposes to hedge balance sheet exposures. Any gains or losses on these contracts are expected to be offset by exchange gains or losses on the underlying exposures and thus are not subject to significant market risk. The change in estimated fair value of the foreign currency contracts for the three and six months ended March 31, 2020 resulted in losses of $0.8 and $0.5, respectively, compared to a gain of $0.7 and a loss of $0.6, respectively, for the three and six months ended March 31, 2019, and was recorded in Other (income) expense, net in the Condensed Consolidated Statements of Earnings. At March 31, 2020, there were five open foreign currency derivative contracts not designated as cash flow hedges, with a total notional value of $39.0. The following table provides estimated fair values of derivative instruments: Fair Value of Asset (Liability) (1) March 31, September 30, Derivatives designated as cash flow hedging relationships: Foreign currency contracts $ 2.1 $ 1.7 Derivatives not designated as cash flow hedging relationships: Foreign currency contracts $ (0.5) $ 0.4 (1) All derivative assets are presented in Other current assets or Other assets. All derivative liabilities are presented in Other current liabilities or Other liabilities. The following table provides the amounts of gains and losses on derivative instruments: Three Months Ended Six Months Ended 2020 2019 2020 2019 Derivatives designated as cash flow hedging relationships: Foreign currency contracts Loss recognized in OCI (1) $ 2.9 $ 1.8 $ 2.0 $ 1.6 Gain reclassified from AOCI into income (1) (2) 0.7 1.3 $ 1.6 $ 3.1 Derivatives not designated as cash flow hedging relationships: Foreign currency contracts Gain (loss) recognized in income (2) $ (0.8) $ 0.7 $ (0.5) $ (0.6) (1) Each of these derivative instruments had a high correlation to the underlying exposure being hedged for the periods indicated and had been deemed highly effective by the Company in offsetting associated risk. (2) Gain (loss) was recorded in Other expense (income), net. The following table provides financial assets and liabilities for balance sheet offsetting: At March 31, 2020 At September 30, 2019 Assets (1) Liabilities (2) Assets (1) Liabilities (2) Foreign currency contracts Gross amounts of recognized assets (liabilities) $ 2.6 $ (1.2) $ 2.4 $ (0.5) Gross amounts offset in the balance sheet — 0.2 — 0.2 Net amounts of assets (liabilities) presented in the balance sheet $ 2.6 $ (1.0) $ 2.4 $ (0.3) (1) All derivative assets are presented in Other current assets or Other assets. (2) All derivative liabilities are presented in Other current liabilities or Other liabilities. Fair Value Hierarchy Accounting guidance on fair value measurements for certain financial assets and liabilities requires that assets and liabilities carried at fair value be classified in one of the following three categories: Level 1: Quoted market prices in active markets for identical assets or liabilities. Level 2: Observable market-based inputs or unobservable inputs that are corroborated by market data. Level 3: Unobservable inputs reflecting the reporting entity’s own assumptions or external inputs from inactive markets. The following table sets forth the Company’s financial assets and liabilities, which are carried at fair value and measured on a recurring basis during the period, all of which are classified as Level 2 within the fair value hierarchy: March 31, September 30, Liabilities at estimated fair value: Deferred compensation $ (31.3) $ (40.6) Derivatives - foreign currency contracts 1.6 2.1 Net liabilities at estimated fair value $ (29.7) $ (38.5) The estimated fair value of the deferred compensation liability is determined based upon the quoted market prices of the investment options that are offered under the plan. At March 31, 2020, the estimated fair value of foreign currency contracts is the amount that the Company would receive or pay to terminate the contracts, considering first the quoted market prices of comparable agreements or, in the absence of quoted market prices, factors such as interest rates, currency exchange rates, and remaining maturities. At March 31, 2020 and September 30, 2019, the Company had no Level 1 or Level 3 financial assets or liabilities, other than pension plan assets. At March 31, 2020 and September 30, 2019, the fair market value of fixed rate long-term debt was $1,045.1 and $1,071.2, respectively, compared to its carrying value of $1,100.0. The estimated fair value of the long-term debt was estimated using yields obtained from independent pricing sources for similar types of borrowing arrangements. The estimated fair value of long-term debt, excluding revolving credit facilities, have been determined based on Level 2 inputs. Due to the nature of cash and cash equivalents and short-term borrowings, including notes payable, carrying amounts on the balance sheets approximate fair value. Additionally, the carrying amounts of the Company’s revolving credit facilities, which are classified as long-term debt on the balance sheet, approximate fair value due to the revolving nature of the balances. The estimated fair value of cash and cash equivalents, short-term borrowings, and the revolving credit agreements have been determined based on Level 2 inputs. |
Segment Data
Segment Data | 6 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Segment Data | Segment Data For an overview of the Company’s segments, refer to Note 1 to Notes to Condensed Consolidated Financial Statements. Segment performance is evaluated based on segment profit, exclusive of general corporate expenses, share-based compensation costs, restructuring charges, and certain costs deemed non-recurring in nature, including acquisition and integration planning costs, the gain on the disposal of the Infant and Pet Care business, Feminine and Infant Care evaluation costs, legal settlement expenses, and the amortization of intangible assets. Financial items, such as interest income and expense, are managed on a global basis at the corporate level. The exclusion of such charges from segment results reflects management’s view on how it evaluates segment performance. The Company completed the sale of its Infant and Pet Care business in December 2019. As a result, no additional Net Sales or Segment Profit will be reported for the All Other segment in subsequent periods. Net Sales and Operating Profit for the Company’s manicure kits were reclassified to Sun and Skin Care for both the current and prior year periods as these products were not part of the divestiture. The impact of recasting the prior period segment information was not material. The Company’s operating model includes some shared business functions across the segments, including product warehousing and distribution, transaction processing functions and, in most cases, combined sales force and management teams. The Company applies a fully allocated cost basis in which shared business functions are allocated between the segments. As a result of the divestiture of the Infant and Pet Care business, some shared costs which were previously allocated to the All Other segment are now being allocated to the Wet Shave, Sun and Skin Care and Feminine Care segments, with the largest impact to Wet Shave, as noted in the discussion in Item 2. Management’s Discussion and Analysis. Segment net sales and profitability are presented below: Three Months Ended Six Months Ended 2020 2019 2020 2019 Net Sales Wet Shave $ 280.5 $ 294.4 $ 557.5 $ 582.1 Sun and Skin Care 157.5 146.0 232.6 213.4 Feminine Care 85.0 74.6 160.1 149.3 All Other — 31.7 26.8 59.0 Total net sales $ 523.0 $ 546.7 $ 977.0 $ 1,003.8 Segment Profit Wet Shave $ 44.5 $ 55.7 $ 97.4 $ 110.7 Sun and Skin Care 44.3 40.7 44.4 40.3 Feminine Care 18.3 13.7 31.4 21.2 All Other — 5.8 3.1 6.8 Total segment profit 107.1 115.9 176.3 179.0 General corporate and other expenses (10.9) (16.7) (24.2) (30.4) Restructuring and related costs (1) (12.4) (15.4) (20.4) (33.9) Acquisition and integration planning costs (2) (25.5) (0.5) (31.7) (1.0) Gain on sale of Infant and Pet Care business (1.1) — 4.1 — Feminine and Infant Care evaluation costs (3) — (1.0) (0.3) (1.0) Sun Care reformulation costs (4) — (0.4) — (0.5) Legal settlement expense (5) — — — (0.9) Amortization of intangibles (4.2) (4.5) (8.5) (9.0) Interest and other expense, net (24.8) (13.7) (37.5) (31.0) Total earnings before income taxes $ 28.2 $ 63.7 $ 57.8 $ 71.3 (1) Includes pre-tax SG&A of $5.8 and $7.7 for the three and six months ended March 31, 2020, respectively, and $1.9 and $3.3 for the three and six months ended March 31, 2019, respectively, associated with certain information technology enablement expenses and incentive and retention compensation expenses for Project Fuel. Additionally, includes pre-tax Cost of products sold of $0.1 for the three and six months ended March 31, 2020, related to inventory write-offs associated with Project Fuel. (2) Includes pre-tax SG&A of $25.5 and $31.7 for the three and six months ended March 31, 2020, respectively, and $0.5 and $1.0 for the three and six months ended March 31, 2019, respectively, related to acquisition and integration planning costs. (3) Includes pre-tax SG&A of $0.3 for the six months ended March 31, 2020, and $1.0 for the three and six months ended March 31, 2019. (4) Includes pre-tax Cost of products sold of $0.4 and $0.5 for the three and six months ended March 31, 2019, respectively. (5) Includes pre-tax SG&A of $0.9 for the six months ended March 31, 2019. The following table presents the Company’s net sales by geographic area: Three Months Ended Six Months Ended 2020 2019 2020 2019 Net Sales to Customers United States $ 302.3 $ 310.4 $ 553.4 $ 561.7 International 220.7 236.3 423.6 442.1 Total net sales $ 523.0 $ 546.7 $ 977.0 $ 1,003.8 Supplemental product information is presented below for net sales: Three Months Ended Six Months Ended 2020 2019 2020 2019 Razors and blades $ 246.1 $ 260.6 $ 490.4 $ 515.9 Tampons, pads, and liners 85.0 74.6 160.1 149.3 Sun care products 115.1 116.3 152.3 149.5 Skin care products 42.4 29.7 80.3 63.9 Shaving gels and creams 34.4 33.8 67.1 66.2 Infant care and other — 31.7 26.8 59.0 Total net sales $ 523.0 $ 546.7 $ 977.0 $ 1,003.8 |
Restructuring Charges (Tables)
Restructuring Charges (Tables) | 6 Months Ended |
Mar. 31, 2020 | |
Restructuring Charges [Abstract] | |
Schedule of Charges Related to Restructuring Activities | The Company does not include Project Fuel restructuring costs in the results of its reportable segments. The estimated impact of allocating such charges to segment results for the three and six months ended March 31, 2020 and 2019 would have been as follows: Three Months Ended March 31, 2020 Wet Sun and Skin Care Feminine Care Corporate Total Project Fuel Severance and related benefit costs $ 0.2 $ — $ — $ 0.6 0.8 Asset impairment and accelerated depreciation 1.0 — — — 1.0 Consulting, project implementation and management, and other exit costs 3.0 0.2 0.2 7.2 10.6 Total Restructuring $ 4.2 $ 0.2 $ 0.2 $ 7.8 $ 12.4 Six Months Ended March 31, 2020 Wet Shave Sun and Skin Care Feminine Care Corporate Total Project Fuel Severance and related benefit costs $ 0.2 $ — $ — $ 1.9 2.1 Asset impairment and accelerated depreciation 1.0 — — — 1.0 Consulting, project implementation and management, and other exit costs 5.8 0.2 0.2 11.1 17.3 Total Restructuring $ 7.0 $ 0.2 $ 0.2 $ 13.0 $ 20.4 Three Months Ended March 31, 2019 Wet Sun and Skin Care Feminine Care All Other Corporate Total Project Fuel Severance and related benefit costs $ 4.4 $ 1.7 $ 0.9 $ 0.3 $ 1.8 $ 9.1 Asset impairment and accelerated depreciation 0.5 — — — — 0.5 Consulting, project implementation and management, and other exit costs — — — — 5.8 5.8 Total Restructuring $ 4.9 $ 1.7 $ 0.9 $ 0.3 $ 7.6 $ 15.4 Six Months Ended March 31, 2019 Wet Shave Sun and Skin Care Feminine Care All Other Corporate Total Project Fuel Severance and related benefit costs $ 11.7 $ 2.2 $ 1.2 $ 0.4 $ 2.8 $ 18.3 Asset impairment and accelerated depreciation 0.5 — — — 0.5 1.0 Consulting, project implementation and management, and other exit costs 2.3 — — — 12.3 14.6 Total Restructuring $ 14.5 $ 2.2 $ 1.2 $ 0.4 $ 15.6 $ 33.9 Pre-tax Selling, General and Administrative expense (“SG&A”) of $5.8 and $7.7 for the three and six months ended March 31, 2020, respectively, and $1.9 and $3.3 for the three and six months ended March 31, 2019, respectively, associated with certain information technology enablement expenses and compensation expenses related to Project Fuel were included in Consulting, project implementation and management, and other exit costs. Pre-tax Cost of products sold of $0.1 for the three and six months ended March 31, 2020, related to inventory write-offs associated with Project Fuel, were included in Asset impairment and accelerated depreciation. |
Schedule of Restructuring Activities and Related Accruals | The following table summarizes the Restructuring activities and related accrual (excluding certain obsolescence charges related to the restructuring) for fiscal 2020: Utilized October 1, 2019 Charge to Other (1) Cash Non-Cash March 31, Restructuring Severance and related benefit costs $ 8.2 $ 2.1 $ (0.1) $ (6.1) $ — $ 4.1 Asset impairment and accelerated depreciation — 1.0 — — (1.0) — Consulting, project implementation and management, and other exit costs 1.3 17.3 — (17.6) — 1.0 Total Restructuring $ 9.5 $ 20.4 $ (0.1) $ (23.7) $ (1.0) $ 5.1 (1) Includes the impact of currency translation. |
Earnings per Share (Tables)
Earnings per Share (Tables) | 6 Months Ended |
Mar. 31, 2020 | |
Earnings Per Share [Abstract] | |
Schedule of Weighted-Average Shares Outstanding | The following is the reconciliation between the number of weighted-average shares used in the basic and diluted earnings per share calculation: Three Months Ended Six Months Ended 2020 2019 2020 2019 Basic weighted-average shares outstanding 54.3 54.1 54.3 54.1 Effect of dilutive securities: RSE awards 0.2 0.2 0.2 0.2 Total dilutive securities 0.2 0.2 0.2 0.2 Diluted weighted-average shares outstanding 54.5 54.3 54.5 54.3 |
Goodwill and Intangible Assets
Goodwill and Intangible Assets (Tables) | 6 Months Ended |
Mar. 31, 2020 | |
Goodwill and Intangible Assets Disclosure [Abstract] | |
Schedule of Goodwill | The following table sets forth goodwill by segment: Wet Sun and Skin Feminine All Total Gross balance at October 1, 2019 $ 960.3 $ 228.3 $ 207.0 $ 69.6 $ 1,465.2 Accumulated goodwill impairment (369.0) (2.0) — (61.4) (432.4) Net balance at October 1, 2019 $ 591.3 $ 226.3 $ 207.0 $ 8.2 $ 1,032.8 Changes in the six-month period ended March 31, 2020 Infant and Pet Care divestiture — — — (8.2) (8.2) Cumulative translation adjustment 1.2 0.2 (2.4) — (1.0) Gross balance at March 31, 2020 $ 961.5 $ 228.5 $ 204.6 $ 61.4 $ 1,456.0 Accumulated goodwill impairment (369.0) (2.0) — (61.4) (432.4) Net balance at March 31, 2020 $ 592.5 $ 226.5 $ 204.6 $ — $ 1,023.6 |
Schedule of Amortizable Intangible Assets | March 31, 2020 September 30, 2019 Gross Accumulated Net Gross Accumulated Net Trade names and brands $ 206.5 $ 40.0 $ 166.5 $ 206.4 $ 35.0 $ 171.4 Technology and patents 76.1 74.6 1.5 78.5 76.4 2.1 Customer related and other 175.3 103.7 71.6 176.0 100.9 75.1 Total amortizable intangible assets $ 457.9 $ 218.3 $ 239.6 $ 460.9 $ 212.3 $ 248.6 |
Supplemental Balance Sheet In_2
Supplemental Balance Sheet Information (Tables) | 6 Months Ended |
Mar. 31, 2020 | |
Supplemental Balance Sheet Information [Abstract] | |
Supplement Balance Sheet Information | March 31, September 30, Inventories Raw materials and supplies $ 55.3 $ 55.1 Work in process 64.6 66.5 Finished products 220.2 235.6 Total inventories $ 340.1 $ 357.2 Other Current Assets Miscellaneous receivables $ 13.8 $ 14.9 Inventory returns receivable 0.6 4.9 Prepaid expenses 67.9 65.0 Value added tax collectible from customers 20.1 23.0 Income taxes receivable 15.5 29.1 Other 12.6 3.1 Total other current assets $ 130.5 $ 140.0 Property, Plant and Equipment Land $ 18.8 $ 18.7 Buildings 137.5 137.4 Machinery and equipment 986.0 992.3 Capitalized software costs 46.1 47.8 Construction in progress 34.1 40.9 Total gross property, plant and equipment 1,222.5 1,237.1 Accumulated depreciation and amortization (850.5) (841.1) Total property, plant and equipment, net $ 372.0 $ 396.0 Other Current Liabilities Accrued advertising, sales promotion and allowances $ 42.3 $ 51.9 Accrued trade allowances 24.9 26.2 Accrued salaries, vacations and incentive compensation 42.8 51.5 Income taxes payable 15.6 11.5 Returns reserve 32.6 60.4 Restructuring reserve 5.1 9.5 Value added tax payable 7.3 3.6 Deferred compensation 6.6 10.4 Short term lease obligation 10.8 — Customer advance payments 1.9 1.7 Other 88.3 78.7 Total other current liabilities $ 278.2 $ 305.4 Other Liabilities Pensions and other retirement benefits $ 147.5 $ 149.8 Deferred compensation 25.1 30.3 Long term lease obligation 38.4 — Other non-current liabilities 81.0 78.8 Total other liabilities $ 292.0 $ 258.9 |
Leases (Tables)
Leases (Tables) | 6 Months Ended |
Mar. 31, 2020 | |
Leases [Abstract] | |
Summary of Lease Information | A summary of the company's lease information is as follows: March 31, Assets Classification Right of use assets Other assets $ 48.8 Liabilities Current lease liabilities Other current liabilities $ 10.8 Long-term lease liabilities Other liabilities 38.4 Total lease liabilities $ 49.2 Other information Weighted-average remaining lease term (years) 11 Weighted-average incremental borrowing rate 6.8 % Three Months Ended March 31, 2020 Six Months Ended March 31, 2020 Statement of Income Lease cost (1) $ 3.4 $ 7.1 Other information Leased assets obtained in exchange for new lease liabilities $ 0.5 $ 0.6 Cash paid for amounts included in the measurement of lease liabilities $ 3.2 $ 7.0 |
Lessee, Operating Lease, Liability, Maturity | The Company's future lease payments including reasonable assured renewal options under lease agreements are as follows: Operating Leases Remainder of fiscal 2020 $ 7.1 2021 11.1 2022 8.3 2023 6.9 2024 5.5 2025 and thereafter 40.4 Total future minimum lease commitments 79.3 Less: Imputed Interest (30.1) Present value of lease liabilities $ 49.2 At September 30, 2019, the aggregate future minimum rental commitments under all non-cancelable operating lease agreements were as follows: Operating Leases 2020 $ 13.6 2021 10.5 2022 7.4 2023 5.9 2024 4.6 2025 and thereafter 12.5 Total future minimum lease commitments $ 54.5 |
Debt (Tables)
Debt (Tables) | 6 Months Ended |
Mar. 31, 2020 | |
Debt Disclosure [Abstract] | |
Schedule of Long-term Debt | The detail of long-term debt was as follows: March 31, September 30, Senior notes, fixed interest rate of 4.7%, due 2021 $ 600.0 $ 600.0 Senior notes, fixed interest rate of 4.7%, due 2022 500.0 500.0 U.S. revolving credit facility due 2020 — 117.0 Total long-term debt, including current maturities 1,100.0 1,217.0 Less current portion — 117.0 Less unamortized debt issuance costs and discount (1) (2) 1.7 2.2 Total long-term debt $ 1,098.3 $ 1,097.8 (1) At March 31, 2020, the balance for the senior notes due 2021 and the senior notes due 2022 are reflected net of debt issuance costs of $0.5 and $0.9, respectively. At September 30, 2019, the balance for the senior notes due 2021 and the senior notes due 2022 are reflected net of debt issuance costs of $0.8 and $1.0, respectively. (2) At March 31, 2020 and September 30, 2019, the balance for the senior notes due 2022 was reflected net of discount of $0.3 and $0.4, respectively. |
Retirement Plans (Tables)
Retirement Plans (Tables) | 6 Months Ended |
Mar. 31, 2020 | |
Retirement Benefits [Abstract] | |
Schedule of Net Periodic Pension and Postretirement Cost (Benefit) | The Company’s net periodic pension and postretirement costs for these plans for the three and six months ended March 31 were as follows: Three Months Ended Six Months Ended 2020 2019 2020 2019 Service cost $ 1.0 $ 0.8 $ 2.1 $ 1.5 Interest cost 3.5 4.7 6.9 9.4 Expected return on plan assets (5.7) (6.3) (11.5) (12.6) Recognized net actuarial loss 2.3 1.0 4.6 2.0 Settlement loss recognized 0.2 — 0.4 — Net periodic cost $ 1.3 $ 0.2 $ 2.5 $ 0.3 |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Loss (Tables) | 6 Months Ended |
Mar. 31, 2020 | |
Accumulated Other Comprehensive Income (Loss), Net of Tax [Abstract] | |
Schedule of Changes in Accumulated Other Comprehensive Loss | The following table presents the changes in accumulated other comprehensive (loss) income (“AOCI”), net of tax, by component: Foreign Pension and Hedging Total Balance at October 1, 2019 $ (77.3) $ (159.8) $ 1.2 $ (235.9) OCI before reclassifications (1) (6.4) (4.3) 1.4 (9.3) Reclassifications to earnings — 3.6 (1.1) 2.5 Balance at March 31, 2020 $ (83.7) $ (160.5) $ 1.5 $ (242.7) Foreign Pension and Hedging Total Balance at October 1, 2018 $ (40.6) $ (110.3) $ 2.6 $ (148.3) OCI before reclassifications (1) (22.0) (1.2) 1.1 (22.1) Reclassifications to earnings — 1.5 (2.1) (0.6) Balance at March 31, 2019 $ (62.6) $ (110.0) $ 1.6 $ (171.0) (1) OCI is defined as other comprehensive income (loss). |
Schedule of Reclassifications out of Accumulated Other Comprehensive Loss | The following table presents the reclassifications out of AOCI: Three Months Ended Six Months Ended Affected Line Item in the Details of AOCI Components 2020 2019 2020 2019 Gain / (Loss) on cash flow hedges Foreign exchange contracts $ 0.7 $ 1.3 $ 1.6 $ 3.1 Other (income) expense, net 0.7 1.3 1.6 3.1 Total before tax 0.2 0.4 0.5 1.0 Income tax provision 0.5 0.9 1.1 2.1 Net of tax Amortization of defined benefit pension and postretirement items Actuarial losses $ (2.3) $ (1.0) $ (4.6) $ (2.0) (1) Settlements (0.2) — (0.4) — (2.5) (1.0) (5.0) (2.0) Total before tax (0.7) (0.2) (1.4) (0.5) Income tax provision (1.8) (0.8) (3.6) (1.5) Net of tax Total reclassifications for the period $ (1.3) $ 0.1 $ (2.5) $ 0.6 Net of tax (1) These AOCI components are included in the computation of net periodic cost (benefit). See Note 11 of Notes to Condensed Consolidated Financial Statements. |
Financial Instruments and Ris_2
Financial Instruments and Risk Management (Tables) | 6 Months Ended |
Mar. 31, 2020 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Schedule of Fair Values of Derivative Instruments | The following table provides estimated fair values of derivative instruments: Fair Value of Asset (Liability) (1) March 31, September 30, Derivatives designated as cash flow hedging relationships: Foreign currency contracts $ 2.1 $ 1.7 Derivatives not designated as cash flow hedging relationships: Foreign currency contracts $ (0.5) $ 0.4 (1) All derivative assets are presented in Other current assets or Other assets. All derivative liabilities are presented in Other current liabilities or Other liabilities. |
Schedule of Gains and Losses on Derivative Instruments | The following table provides the amounts of gains and losses on derivative instruments: Three Months Ended Six Months Ended 2020 2019 2020 2019 Derivatives designated as cash flow hedging relationships: Foreign currency contracts Loss recognized in OCI (1) $ 2.9 $ 1.8 $ 2.0 $ 1.6 Gain reclassified from AOCI into income (1) (2) 0.7 1.3 $ 1.6 $ 3.1 Derivatives not designated as cash flow hedging relationships: Foreign currency contracts Gain (loss) recognized in income (2) $ (0.8) $ 0.7 $ (0.5) $ (0.6) (1) Each of these derivative instruments had a high correlation to the underlying exposure being hedged for the periods indicated and had been deemed highly effective by the Company in offsetting associated risk. |
Schedule of Offsetting Assets and Liabilities | The following table provides financial assets and liabilities for balance sheet offsetting: At March 31, 2020 At September 30, 2019 Assets (1) Liabilities (2) Assets (1) Liabilities (2) Foreign currency contracts Gross amounts of recognized assets (liabilities) $ 2.6 $ (1.2) $ 2.4 $ (0.5) Gross amounts offset in the balance sheet — 0.2 — 0.2 Net amounts of assets (liabilities) presented in the balance sheet $ 2.6 $ (1.0) $ 2.4 $ (0.3) (1) All derivative assets are presented in Other current assets or Other assets. (2) All derivative liabilities are presented in Other current liabilities or Other liabilities. |
Schedule of Fair Value of Assets and Liabilities Measured on Recurring Basis | The following table sets forth the Company’s financial assets and liabilities, which are carried at fair value and measured on a recurring basis during the period, all of which are classified as Level 2 within the fair value hierarchy: March 31, September 30, Liabilities at estimated fair value: Deferred compensation $ (31.3) $ (40.6) Derivatives - foreign currency contracts 1.6 2.1 Net liabilities at estimated fair value $ (29.7) $ (38.5) |
Segment Data (Tables)
Segment Data (Tables) | 6 Months Ended |
Mar. 31, 2020 | |
Segment Reporting [Abstract] | |
Schedule of Segment Sales and Profitability | Segment net sales and profitability are presented below: Three Months Ended Six Months Ended 2020 2019 2020 2019 Net Sales Wet Shave $ 280.5 $ 294.4 $ 557.5 $ 582.1 Sun and Skin Care 157.5 146.0 232.6 213.4 Feminine Care 85.0 74.6 160.1 149.3 All Other — 31.7 26.8 59.0 Total net sales $ 523.0 $ 546.7 $ 977.0 $ 1,003.8 Segment Profit Wet Shave $ 44.5 $ 55.7 $ 97.4 $ 110.7 Sun and Skin Care 44.3 40.7 44.4 40.3 Feminine Care 18.3 13.7 31.4 21.2 All Other — 5.8 3.1 6.8 Total segment profit 107.1 115.9 176.3 179.0 General corporate and other expenses (10.9) (16.7) (24.2) (30.4) Restructuring and related costs (1) (12.4) (15.4) (20.4) (33.9) Acquisition and integration planning costs (2) (25.5) (0.5) (31.7) (1.0) Gain on sale of Infant and Pet Care business (1.1) — 4.1 — Feminine and Infant Care evaluation costs (3) — (1.0) (0.3) (1.0) Sun Care reformulation costs (4) — (0.4) — (0.5) Legal settlement expense (5) — — — (0.9) Amortization of intangibles (4.2) (4.5) (8.5) (9.0) Interest and other expense, net (24.8) (13.7) (37.5) (31.0) Total earnings before income taxes $ 28.2 $ 63.7 $ 57.8 $ 71.3 (1) Includes pre-tax SG&A of $5.8 and $7.7 for the three and six months ended March 31, 2020, respectively, and $1.9 and $3.3 for the three and six months ended March 31, 2019, respectively, associated with certain information technology enablement expenses and incentive and retention compensation expenses for Project Fuel. Additionally, includes pre-tax Cost of products sold of $0.1 for the three and six months ended March 31, 2020, related to inventory write-offs associated with Project Fuel. (2) Includes pre-tax SG&A of $25.5 and $31.7 for the three and six months ended March 31, 2020, respectively, and $0.5 and $1.0 for the three and six months ended March 31, 2019, respectively, related to acquisition and integration planning costs. (3) Includes pre-tax SG&A of $0.3 for the six months ended March 31, 2020, and $1.0 for the three and six months ended March 31, 2019. (4) Includes pre-tax Cost of products sold of $0.4 and $0.5 for the three and six months ended March 31, 2019, respectively. (5) Includes pre-tax SG&A of $0.9 for the six months ended March 31, 2019. |
Schedule of Sales by Geographic Area | The following table presents the Company’s net sales by geographic area: Three Months Ended Six Months Ended 2020 2019 2020 2019 Net Sales to Customers United States $ 302.3 $ 310.4 $ 553.4 $ 561.7 International 220.7 236.3 423.6 442.1 Total net sales $ 523.0 $ 546.7 $ 977.0 $ 1,003.8 |
Schedule of Supplemental Product Information | Supplemental product information is presented below for net sales: Three Months Ended Six Months Ended 2020 2019 2020 2019 Razors and blades $ 246.1 $ 260.6 $ 490.4 $ 515.9 Tampons, pads, and liners 85.0 74.6 160.1 149.3 Sun care products 115.1 116.3 152.3 149.5 Skin care products 42.4 29.7 80.3 63.9 Shaving gels and creams 34.4 33.8 67.1 66.2 Infant care and other — 31.7 26.8 59.0 Total net sales $ 523.0 $ 546.7 $ 977.0 $ 1,003.8 |
Background and Basis of Prese_2
Background and Basis of Presentation (Details) $ in Millions | Mar. 31, 2020USD ($)country | Oct. 01, 2019USD ($) |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Number of countries in which Edgewell operates | country | 20 | |
Number of countries with retail operations | country | 50 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Operating lease, right-of-use asset | $ 48.8 | |
Operating lease, liability | $ 49.2 | |
Accounting standards update 2016-02 | ||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||
Operating lease, right-of-use asset | $ 57.4 | |
Operating lease, liability | $ 57.5 |
Divestitures (Details)
Divestitures (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | Dec. 17, 2019 | |
Divestiture | |||||
Proceeds from sale of Infant and Pet Care business | $ 95.8 | $ 0 | |||
Gain on sale of Infant and Pet Care business | $ 1.1 | $ 0 | (4.1) | $ 0 | |
Infant and Pet Care | Disposal group, not discontinued operations | |||||
Divestiture | |||||
Divestiture, sale price | 122.5 | ||||
Proceeds from sale of Infant and Pet Care business | 107.5 | ||||
Proceeds from sale receivable, current | $ 7.5 | ||||
Proceeds from sale receivable, noncurrent | 5 | ||||
Disposal, inventory | 18.8 | ||||
Disposal, fixed assets | 3.6 | ||||
Disposal, goodwill and intangible assets | $ 77.8 | ||||
Gain on sale of Infant and Pet Care business | $ 4.1 |
Restructuring Charges (Schedule
Restructuring Charges (Schedule of Charges Related to Restructuring Activities) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring Charges, Including Amounts in Selling, General and Administrative Expenses and Cost of Product Sold | $ 12.4 | [1] | $ 15.4 | [1] | $ 20.4 | $ 33.9 |
Project Fuel | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Severance and related benefit costs | 0.8 | 9.1 | 2.1 | 18.3 | ||
Asset impairment and accelerated depreciation | 1 | 0.5 | 1 | 1 | ||
Consulting, project implementation and management, and other exit costs | 10.6 | 5.8 | 17.3 | 14.6 | ||
Restructuring Charges, Including Amounts in Selling, General and Administrative Expenses and Cost of Product Sold | 12.4 | 15.4 | 20.4 | 33.9 | ||
Project Fuel | Wet Shave | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Severance and related benefit costs | 0.2 | 4.4 | 0.2 | 11.7 | ||
Asset impairment and accelerated depreciation | 1 | 0.5 | 1 | 0.5 | ||
Consulting, project implementation and management, and other exit costs | 3 | 0 | 5.8 | 2.3 | ||
Restructuring Charges, Including Amounts in Selling, General and Administrative Expenses and Cost of Product Sold | 4.2 | 4.9 | 7 | 14.5 | ||
Project Fuel | Sun and Skin Care | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Severance and related benefit costs | 0 | 1.7 | 0 | 2.2 | ||
Asset impairment and accelerated depreciation | 0 | 0 | 0 | 0 | ||
Consulting, project implementation and management, and other exit costs | 0.2 | 0 | 0.2 | 0 | ||
Restructuring Charges, Including Amounts in Selling, General and Administrative Expenses and Cost of Product Sold | 0.2 | 1.7 | 0.2 | 2.2 | ||
Project Fuel | Feminine Care | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Severance and related benefit costs | 0 | 0.9 | 0 | 1.2 | ||
Asset impairment and accelerated depreciation | 0 | 0 | 0 | 0 | ||
Consulting, project implementation and management, and other exit costs | 0.2 | 0 | 0.2 | 0 | ||
Restructuring Charges, Including Amounts in Selling, General and Administrative Expenses and Cost of Product Sold | 0.2 | 0.9 | 0.2 | 1.2 | ||
Project Fuel | All Other | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Severance and related benefit costs | 0.3 | 0.4 | ||||
Asset impairment and accelerated depreciation | 0 | 0 | ||||
Consulting, project implementation and management, and other exit costs | 0 | 0 | ||||
Restructuring Charges, Including Amounts in Selling, General and Administrative Expenses and Cost of Product Sold | 0.3 | 0.4 | ||||
Project Fuel | Corporate | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Severance and related benefit costs | 0.6 | 1.8 | 1.9 | 2.8 | ||
Asset impairment and accelerated depreciation | 0 | 0 | 0 | 0.5 | ||
Consulting, project implementation and management, and other exit costs | 7.2 | 5.8 | 11.1 | 12.3 | ||
Restructuring Charges, Including Amounts in Selling, General and Administrative Expenses and Cost of Product Sold | 7.8 | 7.6 | 13 | 15.6 | ||
IT enablement | Selling, general and administrative expenses | Project Fuel | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring Charges, Including Amounts in Selling, General and Administrative Expenses and Cost of Product Sold | 5.8 | $ 1.9 | 7.7 | $ 3.3 | ||
Inventory obsolescence | Cost of products sold | Project Fuel | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring Charges, Including Amounts in Selling, General and Administrative Expenses and Cost of Product Sold | $ 0.1 | $ 0.1 | ||||
[1] | Includes pre-tax SG&A of $5.8 and $7.7 for the three and six months ended March 31, 2020, respectively, and $1.9 and $3.3 for the three and six months ended March 31, 2019, respectively, associated with certain information technology enablement expenses and incentive and retention compensation expenses for Project Fuel. Additionally, includes pre-tax Cost of products sold of $0.1 for the three and six months ended March 31, 2020, related to inventory write-offs associated with Project Fuel. |
Restructuring Charges (Schedu_2
Restructuring Charges (Schedule of Restructuring Activities and Related Accruals) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | ||||
Restructuring Reserve [Roll Forward] | |||||||
Restructuring and related costs | $ 12.4 | [1] | $ 15.4 | [1] | $ 20.4 | $ 33.9 | |
Project Fuel | |||||||
Restructuring Reserve [Roll Forward] | |||||||
Beginning Balance | 9.5 | ||||||
Restructuring and related costs | 12.4 | $ 15.4 | 20.4 | $ 33.9 | |||
Other | [2] | (0.1) | |||||
Utilized - Cash Payments | (23.7) | ||||||
Utilized - Non-Cash | (1) | ||||||
Ending Balance | 5.1 | 5.1 | |||||
Employee Severance [Member] | Project Fuel | |||||||
Restructuring Reserve [Roll Forward] | |||||||
Beginning Balance | 8.2 | ||||||
Restructuring and related costs | 2.1 | ||||||
Other | [2] | (0.1) | |||||
Utilized - Cash Payments | (6.1) | ||||||
Utilized - Non-Cash | 0 | ||||||
Ending Balance | 4.1 | 4.1 | |||||
Asset Impairment and Accelerated Depreciation [Member] | Project Fuel | |||||||
Restructuring Reserve [Roll Forward] | |||||||
Beginning Balance | 0 | ||||||
Restructuring and related costs | 1 | ||||||
Other | [2] | 0 | |||||
Utilized - Cash Payments | 0 | ||||||
Utilized - Non-Cash | (1) | ||||||
Ending Balance | 0 | 0 | |||||
Other Restructuring [Member] | Project Fuel | |||||||
Restructuring Reserve [Roll Forward] | |||||||
Beginning Balance | 1.3 | ||||||
Restructuring and related costs | 17.3 | ||||||
Other | [2] | 0 | |||||
Utilized - Cash Payments | (17.6) | ||||||
Utilized - Non-Cash | 0 | ||||||
Ending Balance | $ 1 | $ 1 | |||||
[1] | Includes pre-tax SG&A of $5.8 and $7.7 for the three and six months ended March 31, 2020, respectively, and $1.9 and $3.3 for the three and six months ended March 31, 2019, respectively, associated with certain information technology enablement expenses and incentive and retention compensation expenses for Project Fuel. Additionally, includes pre-tax Cost of products sold of $0.1 for the three and six months ended March 31, 2020, related to inventory write-offs associated with Project Fuel. | ||||||
[2] | Includes the impact of currency translation. |
Income Taxes (Details)
Income Taxes (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |||
Income Tax Disclosure [Abstract] | ||||||
Earnings before income taxes | $ 28.2 | $ 63.7 | $ 57.8 | $ 71.3 | ||
Effective tax rate | 30.60% | 24.40% | 27.40% | 33.00% | ||
Income tax provision | $ 8.7 | $ 15.5 | $ 15.9 | $ 23.5 | ||
Restructuring and related costs | 12.4 | [1] | 15.4 | [1] | 20.4 | 33.9 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Income tax provision | 8.7 | 15.5 | 15.9 | 23.5 | ||
US Tax Act | ||||||
Income Tax Disclosure [Abstract] | ||||||
Income tax provision | 4.7 | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | ||||||
Income tax provision | 4.7 | |||||
Project Fuel | ||||||
Income Tax Disclosure [Abstract] | ||||||
Restructuring and related costs | $ 12.4 | $ 15.4 | $ 20.4 | $ 33.9 | ||
[1] | Includes pre-tax SG&A of $5.8 and $7.7 for the three and six months ended March 31, 2020, respectively, and $1.9 and $3.3 for the three and six months ended March 31, 2019, respectively, associated with certain information technology enablement expenses and incentive and retention compensation expenses for Project Fuel. Additionally, includes pre-tax Cost of products sold of $0.1 for the three and six months ended March 31, 2020, related to inventory write-offs associated with Project Fuel. |
Earnings per Share (Schedule of
Earnings per Share (Schedule of Weighted-Average Shares Outstanding) (Details) - shares shares in Millions | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |
Schedule Of Weighted Average Number Of Shares [Line Items] | ||||
Basic weighted-average shares outstanding (in shares) | 54.3 | 54.1 | 54.3 | 54.1 |
Effect of dilutive securities (in shares) | 0.2 | 0.2 | 0.2 | 0.2 |
Diluted weighted-average shares outstanding (in shares) | 54.5 | 54.3 | 54.5 | 54.3 |
RSE awards | ||||
Schedule Of Weighted Average Number Of Shares [Line Items] | ||||
Effect of dilutive securities (in shares) | 0.2 | 0.2 | 0.2 | 0.2 |
RSE awards | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Anti-dilutive awards excluded from the calculation of diluted weighted-average shares outstanding (in shares) | 0.1 | 0.1 | 0.1 | 0.1 |
Share options | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Anti-dilutive awards excluded from the calculation of diluted weighted-average shares outstanding (in shares) | 0.7 | 0.5 | 0.7 | 0.5 |
Earnings per Share (Narrative)
Earnings per Share (Narrative) (Details) - shares shares in Millions | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |
Share options | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Anti-dilutive awards excluded from the calculation of diluted weighted-average shares outstanding (in shares) | 0.7 | 0.5 | 0.7 | 0.5 |
RSE awards | ||||
Antidilutive Securities Excluded from Computation of Earnings Per Share [Line Items] | ||||
Anti-dilutive awards excluded from the calculation of diluted weighted-average shares outstanding (in shares) | 0.1 | 0.1 | 0.1 | 0.1 |
Goodwill and Intangible Asset_2
Goodwill and Intangible Assets (Schedule of Goodwill) (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended |
Mar. 31, 2020 | Sep. 30, 2019 | |
Goodwill [Line Items] | ||
Goodwill, Gross | $ 1,456 | $ 1,465.2 |
Accumulated goodwill impairment loss | 432.4 | 432.4 |
Goodwill [Roll Forward] | ||
Beginning balance | 1,032.8 | |
Infant and Pet Care divestiture | 8.2 | |
Cumulative translation adjustment | 1 | |
Ending balance | 1,023.6 | 1,032.8 |
Wet Shave | ||
Goodwill [Line Items] | ||
Goodwill, Gross | 961.5 | 960.3 |
Accumulated goodwill impairment loss | 369 | 369 |
Goodwill [Roll Forward] | ||
Beginning balance | 591.3 | |
Infant and Pet Care divestiture | 0 | |
Cumulative translation adjustment | (1.2) | |
Ending balance | 592.5 | 591.3 |
Impairment loss | 369 | |
Sun and Skin Care | ||
Goodwill [Line Items] | ||
Goodwill, Gross | 228.5 | 228.3 |
Accumulated goodwill impairment loss | 2 | 2 |
Goodwill [Roll Forward] | ||
Beginning balance | 226.3 | |
Infant and Pet Care divestiture | 0 | |
Cumulative translation adjustment | (0.2) | |
Ending balance | 226.5 | 226.3 |
Feminine Care | ||
Goodwill [Line Items] | ||
Goodwill, Gross | 204.6 | 207 |
Accumulated goodwill impairment loss | 0 | 0 |
Goodwill [Roll Forward] | ||
Beginning balance | 207 | |
Infant and Pet Care divestiture | 0 | |
Cumulative translation adjustment | 2.4 | |
Ending balance | 204.6 | 207 |
All Other | ||
Goodwill [Line Items] | ||
Goodwill, Gross | 61.4 | 69.6 |
Accumulated goodwill impairment loss | 61.4 | 61.4 |
Goodwill [Roll Forward] | ||
Beginning balance | 8.2 | |
Infant and Pet Care divestiture | 8.2 | |
Cumulative translation adjustment | 0 | |
Ending balance | $ 0 | 8.2 |
Skin Care | ||
Goodwill [Roll Forward] | ||
Impairment loss | 2 | |
Infant Care | ||
Goodwill [Roll Forward] | ||
Impairment loss | 37 | |
Wet Ones | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Indefinite lived intangible impairment | 87 | |
Diaper Genie | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Indefinite lived intangible impairment | $ 75 |
Goodwill and Intangible Asset_3
Goodwill and Intangible Assets (Schedule of Amortizable Intangible Assets) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | Sep. 30, 2019 | |
Finite-Lived Intangible Assets [Line Items] | |||||
Amortizable intangible assets, gross carrying amount | $ 457.9 | $ 457.9 | $ 460.9 | ||
Amortizable intangible assets, accumulated amortization | 218.3 | 218.3 | 212.3 | ||
Amortizable intangible assets, net | 239.6 | 239.6 | 248.6 | ||
Amortization of intangibles | 4.2 | $ 4.5 | 8.5 | $ 9 | |
Amortizable intangible assets, amortization expense, remainder of 2020 | 8.4 | 8.4 | |||
Amortizable intangible assets, amortization expense, fiscal 2021 | 16.3 | 16.3 | |||
Amortizable intangible assets, amortization expense, fiscal 2022 | 16.2 | 16.2 | |||
Amortizable intangible assets, amortization expense, fiscal 2023 | 16.2 | 16.2 | |||
Amortizable intangible assets, amortization expense, fiscal 2024 | 16.1 | 16.1 | |||
Amortizable intangible assets, amortization expense, fiscal 2025 | 16.1 | 16.1 | |||
Amortizable intangible assets, amortization expense, thereafter | 150.3 | 150.3 | |||
Trade names and brands | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Amortizable intangible assets, gross carrying amount | 206.5 | 206.5 | 206.4 | ||
Amortizable intangible assets, accumulated amortization | 40 | 40 | 35 | ||
Amortizable intangible assets, net | 166.5 | 166.5 | 171.4 | ||
Technology and patents | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Amortizable intangible assets, gross carrying amount | 76.1 | 76.1 | 78.5 | ||
Amortizable intangible assets, accumulated amortization | 74.6 | 74.6 | 76.4 | ||
Amortizable intangible assets, net | 1.5 | 1.5 | 2.1 | ||
Customer related and other | |||||
Finite-Lived Intangible Assets [Line Items] | |||||
Amortizable intangible assets, gross carrying amount | 175.3 | 175.3 | 176 | ||
Amortizable intangible assets, accumulated amortization | 103.7 | 103.7 | 100.9 | ||
Amortizable intangible assets, net | $ 71.6 | $ 71.6 | $ 75.1 |
Goodwill and Intangible Asset_4
Goodwill and Intangible Assets (Narrative) (Details) - USD ($) $ in Millions | 6 Months Ended | 12 Months Ended |
Mar. 31, 2020 | Sep. 30, 2019 | |
Indefinite-lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets | $ 596.6 | $ 664.3 |
Indefinite-lived intangible assets, increase | (67.7) | |
Wet Shave | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets | 178.7 | 177.7 |
Impairment loss | 369 | |
Sun and Skin Care | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets | 388 | 387.9 |
Feminine Care | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets | 29.9 | 29.9 |
All Other | ||
Indefinite-lived Intangible Assets [Line Items] | ||
Indefinite-lived intangible assets | $ 0 | $ 68.8 |
Supplemental Balance Sheet In_3
Supplemental Balance Sheet Information (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Sep. 30, 2019 |
Inventories | ||
Raw materials and supplies | $ 55.3 | $ 55.1 |
Work in process | 64.6 | 66.5 |
Finished products | 220.2 | 235.6 |
Total inventories | 340.1 | 357.2 |
Other Current Assets | ||
Miscellaneous receivables | 13.8 | 14.9 |
Inventory returns receivable | 0.6 | 4.9 |
Prepaid expenses | 67.9 | 65 |
Value added tax collectible from customers | 20.1 | 23 |
Income taxes receivable | 15.5 | 29.1 |
Other | 12.6 | 3.1 |
Total other current assets | 130.5 | 140 |
Property, Plant and Equipment | ||
Land | 18.8 | 18.7 |
Buildings | 137.5 | 137.4 |
Machinery and equipment | 986 | 992.3 |
Capitalized software costs | 46.1 | 47.8 |
Construction in progress | 34.1 | 40.9 |
Total gross property, plant and equipment | 1,222.5 | 1,237.1 |
Accumulated depreciation and amortization | (850.5) | (841.1) |
Total property, plant and equipment, net | 372 | 396 |
Other Current Liabilities | ||
Accrued advertising, sales promotion and allowances | 42.3 | 51.9 |
Accrued trade allowances | 24.9 | 26.2 |
Accrued salaries, vacations and incentive compensation | 42.8 | 51.5 |
Income taxes payable | 15.6 | 11.5 |
Returns reserve | 32.6 | 60.4 |
Restructuring reserve | 5.1 | 9.5 |
Value added tax payable | 7.3 | 3.6 |
Deferred compensation | 6.6 | 10.4 |
Short term lease obligation | 10.8 | 0 |
Customer advance payments | 1.9 | 1.7 |
Other | 88.3 | 78.7 |
Total other current liabilities | 278.2 | 305.4 |
Other Liabilities | ||
Pensions and other retirement benefits | 147.5 | 149.8 |
Deferred compensation | 25.1 | 30.3 |
Long-term income taxes payable | 38.4 | 0 |
Other non-current liabilities | 81 | 78.8 |
Total other liabilities | $ 292 | $ 258.9 |
Leases (Summary of Lease Inform
Leases (Summary of Lease Information) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2020 | Sep. 30, 2019 | ||
Leases [Abstract] | ||||
Operating lease, right-of-use asset | $ 48.8 | $ 48.8 | ||
Short term lease obligation | 10.8 | 10.8 | $ 0 | |
Operating lease, liability, noncurrent | 38.4 | 38.4 | ||
Operating lease, liability | $ 49.2 | $ 49.2 | ||
Operating lease, weighted average remaining lease term | 11 years | 11 years | ||
Operating lease, weighted average discount rate, percent | 6.80% | 6.80% | ||
Operating lease, expense | $ 3.4 | [1] | $ 7.1 | |
Right-of-use asset obtained in exchange for operating lease liability | 0.5 | 0.6 | ||
Operating lease, payments | $ 3.2 | $ 7 | ||
[1] | Lease expense is included in cost of products sold or SG&A expenses based on the nature of the lease. Short-term lease expense is excluded from this amount and is not material. |
Leases (Operating Lease Payment
Leases (Operating Lease Payment Schedule) (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Sep. 30, 2019 |
Leases [Abstract] | ||
Lessee, operating lease, payment due current year | $ 7.1 | |
Lessee, operating lease, payment due year two | 11.1 | |
Lessee, operating lease, payment due year three | 8.3 | |
Lessee, operating lease, payment due year four | 6.9 | |
Lessee, operating lease, payment due year five | 5.5 | |
Lessee, operating lease, payment due after year five | 40.4 | |
Lessee, operating lease, payments due | 79.3 | |
Lessee, operating lease, undiscounted excess amount | 30.1 | |
Operating lease, liability | $ 49.2 | |
Operating leases, future minimum payments due, next twelve months | $ 13.6 | |
Operating leases, future minimum payments, due in two years | 10.5 | |
Operating leases, future minimum payments, due in three years | 7.4 | |
Operating leases, future minimum payments, due in four years | 5.9 | |
Operating leases, future minimum payments, due in five years | 4.6 | |
Operating leases, future minimum payments, due thereafter | 12.5 | |
Operating leases, future minimum payments, due | $ 54.5 |
Accounts Receivable Facility (N
Accounts Receivable Facility (Narrative) (Details) - Accounts receivable sales agreement - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | Sep. 30, 2019 | |
Transfer of Financial Assets Accounted for as Sales [Line Items] | |||||
Transfer of accounts receivable, quarter to date sold | $ 219.5 | $ 232.1 | $ 401.2 | $ 446 | |
Transfer of accounts receivable, sales amount derecognized | 114.5 | 114.5 | $ 74.9 | ||
Loss on sale of accounts receivable | $ 0.4 | $ 0.7 | $ 0.9 | $ 1.3 |
Debt (Details)
Debt (Details) - USD ($) $ in Millions | Mar. 31, 2020 | Sep. 30, 2019 | |
Debt Instrument [Line Items] | |||
Total long-term debt, including current maturities | $ 1,100 | $ 1,217 | |
Current maturities of long-term debt | 0 | 117 | |
Unamortized discount and debit issuance costs | [1],[2] | 1.7 | 2.2 |
Long-term debt | 1,098.3 | 1,097.8 | |
Notes payable | 17.7 | 14.4 | |
Senior notes | Senior notes due 2021 | |||
Debt Instrument [Line Items] | |||
Total long-term debt, including current maturities | 600 | 600 | |
Unamortized debt issuance costs | 0.5 | 0.8 | |
Senior notes | Senior notes due 2022 | |||
Debt Instrument [Line Items] | |||
Total long-term debt, including current maturities | 500 | 500 | |
Unamortized debt issuance costs | 0.9 | 1 | |
Unamortized discount | 0.3 | 0.4 | |
Domestic line of credit | |||
Debt Instrument [Line Items] | |||
Total long-term debt, including current maturities | 0 | $ 117 | |
Revolving Credit Facility due April 2025 | |||
Debt Instrument [Line Items] | |||
Total long-term debt, including current maturities | 425 | ||
Letters of credit available | $ 70 | ||
[1] | At March 31, 2020 and September 30, 2019, the balance for the senior notes due 2022 was reflected net of discount of $0.3 and $0.4, respectively. | ||
[2] | At March 31, 2020, the balance for the senior notes due 2021 and the senior notes due 2022 are reflected net of debt issuance costs of $0.5 and $0.9, respectively. At September 30, 2019, the balance for the senior notes due 2021 and the senior notes due 2022 are reflected net of debt issuance costs of $0.8 and $1.0, respectively. |
Retirement Plans (Details)
Retirement Plans (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |
Retirement Benefits [Abstract] | ||||
Service cost | $ 1 | $ 0.8 | $ 2.1 | $ 1.5 |
Interest cost | 3.5 | 4.7 | 6.9 | 9.4 |
Expected return on plan assets | (5.7) | (6.3) | (11.5) | (12.6) |
Recognized net actuarial loss | 2.3 | 1 | 4.6 | 2 |
Settlement loss recognized | 0.2 | 0 | 0.4 | 0 |
Net periodic cost | $ 1.3 | $ 0.2 | $ 2.5 | $ 0.3 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Loss (Schedule of Accumulated Other Comprehensive Loss) (Details) - USD ($) $ in Millions | 6 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | ||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Beginning balance | $ (235.9) | $ (148.3) | |
OCI before reclassifications | [1] | (9.3) | (22.1) |
Reclassifications to earnings | 2.5 | (0.6) | |
Ending balance | (242.7) | (171) | |
Foreign Currency Translation Adjustments | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Beginning balance | (77.3) | (40.6) | |
OCI before reclassifications | [1] | (6.4) | (22) |
Reclassifications to earnings | 0 | 0 | |
Ending balance | (83.7) | (62.6) | |
Pension and Post-retirement Activity | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Beginning balance | (159.8) | (110.3) | |
OCI before reclassifications | [1] | (4.3) | (1.2) |
Reclassifications to earnings | 3.6 | 1.5 | |
Ending balance | (160.5) | (110) | |
Hedging Activity | |||
AOCI Attributable to Parent, Net of Tax [Roll Forward] | |||
Beginning balance | 1.2 | 2.6 | |
OCI before reclassifications | [1] | 1.4 | 1.1 |
Reclassifications to earnings | (1.1) | (2.1) | |
Ending balance | $ 1.5 | $ 1.6 | |
[1] | OCI is defined as other comprehensive income (loss). |
Accumulated Other Comprehensi_4
Accumulated Other Comprehensive Loss (Schedule of Reclassifications out of Accumulated Other Comprehensive Loss) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||
Reclassifications to earnings | $ (2.5) | $ 0.6 | ||||
Reclassification out of Accumulated Other Comprehensive Income | ||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||
Gains and losses on cash flow hedges, foreign exchange contracts, before tax | $ 0.7 | $ 1.3 | 1.6 | 3.1 | ||
Gains and losses on cash flow hedges, foreign exchange contracts, tax | 0.2 | 0.4 | 0.5 | 1 | ||
Gains and losses on cash flow hedges, foreign exchange contracts, after tax | 0.5 | 0.9 | 1.1 | 2.1 | ||
Amortization of defined benefit pension and postretirement items, actuarial losses, before tax | (2.3) | [1] | (1) | [1] | (4.6) | (2) |
Amortization of defined benefit pension and postretirement items, settlement loss, before tax | 0.2 | 0 | 0.4 | 0 | ||
Amortization of defined benefit pension and postretirement items, before tax | (2.5) | (1) | (5) | (2) | ||
Amortization of defined benefit pension and postretirement items, tax | (0.7) | (0.2) | (1.4) | (0.5) | ||
Amortization of defined benefit pension and postretirement items, after tax | (1.8) | (0.8) | (3.6) | (1.5) | ||
Reclassifications to earnings | (1.3) | 0.1 | (2.5) | 0.6 | ||
Other (income) expense, net | Reclassification out of Accumulated Other Comprehensive Income | ||||||
Reclassification Adjustment out of Accumulated Other Comprehensive Income [Line Items] | ||||||
Gains and losses on cash flow hedges, foreign exchange contracts, before tax | $ 0.7 | $ 1.3 | $ 1.6 | $ 3.1 | ||
[1] | These AOCI components are included in the computation of net periodic cost (benefit). See Note 11 of Notes to Condensed Consolidated Financial Statements. |
Financial Instruments and Ris_3
Financial Instruments and Risk Management (Narrative) (Details) $ in Millions | 3 Months Ended | 6 Months Ended | |||||
Mar. 31, 2020USD ($)contracts | Mar. 31, 2019USD ($) | [1] | Mar. 31, 2020USD ($)contracts | Mar. 31, 2019USD ($) | Sep. 30, 2019USD ($) | ||
Derivative [Line Items] | |||||||
Long-term debt | $ 1,100 | $ 1,100 | $ 1,217 | ||||
Fixed rate | |||||||
Derivative [Line Items] | |||||||
Long-term debt | 1,100 | 1,100 | 1,100 | ||||
Fair value of long-term debt | $ 1,045.1 | $ 1,045.1 | 1,071.2 | ||||
Not designated as hedge | FX contract | |||||||
Derivative [Line Items] | |||||||
Open foreign currency contracts | contracts | 5 | 5 | |||||
Derivative, notional amount | $ 39 | $ 39 | |||||
Cash flow hedge | Designated as hedge | FX contract | |||||||
Derivative [Line Items] | |||||||
Estimated fair value of derivative | $ 2.1 | $ 2.1 | $ 1.7 | ||||
Open foreign currency contracts | contracts | 64 | 64 | |||||
Derivative, notional amount | $ 131.4 | $ 131.4 | |||||
Other (income) expense, net | Not designated as hedge | FX contract | |||||||
Derivative [Line Items] | |||||||
Gain (loss) recognized in income | $ (0.8) | [1] | $ 0.7 | $ (0.5) | $ (0.6) | ||
[1] | Gain (loss) was recorded in Other expense (income), net. |
Financial Instruments and Ris_4
Financial Instruments and Risk Management (Schedule of Fair Values of Derivative Instruments) (Details) - FX contract - USD ($) $ in Millions | Mar. 31, 2020 | Sep. 30, 2019 | |
Not designated as hedge | |||
Derivatives, Fair Value [Line Items] | |||
Estimated fair value of derivatives | [1] | $ (0.5) | $ 0.4 |
Cash flow hedge | Designated as hedge | |||
Derivatives, Fair Value [Line Items] | |||
Estimated fair value of derivatives | [1] | $ 2.1 | $ 1.7 |
[1] | All derivative assets are presented in Other current assets or Other assets. All derivative liabilities are presented in Other current liabilities or Other liabilities. |
Financial Instruments and Ris_5
Financial Instruments and Risk Management (Schedule of Gains and Losses on Derivative Instruments) (Details) - FX contract - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |||
Designated as hedge | Cash flow hedge | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Gain (loss) recognized in OCI | $ 2.9 | [1] | $ 1.8 | [1] | $ 2 | $ 1.6 |
Other (income) expense, net | Designated as hedge | Cash flow hedge | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Gain (loss) reclassified from AOCI into income (effective portion) | 0.7 | [1],[2] | 1.3 | [1],[2] | 1.6 | 3.1 |
Other (income) expense, net | Not designated as hedge | ||||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||||
Gain (loss) recognized in income | $ 0.8 | [2] | $ (0.7) | [2] | $ 0.5 | $ 0.6 |
[1] | Each of these derivative instruments had a high correlation to the underlying exposure being hedged for the periods indicated and had been deemed highly effective by the Company in offsetting associated risk. | |||||
[2] | Gain (loss) was recorded in Other expense (income), net. |
Financial Instruments and Ris_6
Financial Instruments and Risk Management (Schedule of Offsetting Assets and Liabilities) (Details) - FX contract - USD ($) $ in Millions | Mar. 31, 2020 | Sep. 30, 2019 | |
Derivative [Line Items] | |||
Gross amounts of recognized assets | [1] | $ 2.6 | $ 2.4 |
Gross amounts of recognized liabilities | [2] | (1.2) | (0.5) |
Gross amounts offset in the balance sheet | [1] | 0 | 0 |
Gross amounts offset in the balance sheet | [2] | 0.2 | 0.2 |
Net amounts of assets presented in the balance sheet | [1] | 2.6 | 2.4 |
Net amounts of liabilities presented in the balance sheet | [2] | $ (1) | $ (0.3) |
[1] | All derivative assets are presented in Other current assets or Other assets. | ||
[2] | All derivative liabilities are presented in Other current liabilities or Other liabilities. |
Financial Instruments and Ris_7
Financial Instruments and Risk Management (Schedule of Fair Value of Assets and Liabilities Measured on Recurring Basis) (Details) - Recurring fair value measurement - Level 2 - USD ($) $ in Millions | Mar. 31, 2020 | Sep. 30, 2019 |
Derivative [Line Items] | ||
Deferred compensation | $ (31.3) | $ (40.6) |
Derivatives - foreign currency contracts | 1.6 | 2.1 |
Net liabilities at estimated fair value | $ (29.7) | $ (38.5) |
Segment Data (Schedule of Segme
Segment Data (Schedule of Segment Sales and Profitability) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |||
Segment Reporting Information [Line Items] | ||||||
Net sales | $ 523 | $ 546.7 | $ 977 | $ 1,003.8 | ||
Restructuring and related costs | 12.4 | [1] | 15.4 | [1] | 20.4 | 33.9 |
Acquisition and planning costs | 25.5 | [2] | 0.5 | [2] | 31.7 | 1 |
Gain on sale of Infant and Pet Care business | 1.1 | 0 | (4.1) | 0 | ||
Feminine and Infant Care evaluation costs | 0 | [3] | 1 | [3] | 0.3 | 1 |
Sun Care reformulation costs | 0 | [4] | (0.4) | [4] | 0 | (0.5) |
Legal settlement expense | 0 | [5] | 0 | [5] | 0 | (0.9) |
Amortization of intangibles | 4.2 | 4.5 | 8.5 | 9 | ||
Interest and other expense, net | 24.8 | 13.7 | 37.5 | 31 | ||
Earnings before income taxes | 28.2 | 63.7 | 57.8 | 71.3 | ||
Wet Shave | ||||||
Segment Reporting Information [Line Items] | ||||||
Net sales | 280.5 | 294.4 | 557.5 | 582.1 | ||
Segment profit | 44.5 | 55.7 | 97.4 | 110.7 | ||
Sun and Skin Care | ||||||
Segment Reporting Information [Line Items] | ||||||
Net sales | 157.5 | 146 | 232.6 | 213.4 | ||
Segment profit | 44.3 | 40.7 | 44.4 | 40.3 | ||
Feminine Care | ||||||
Segment Reporting Information [Line Items] | ||||||
Net sales | 85 | 74.6 | 160.1 | 149.3 | ||
Segment profit | 18.3 | 13.7 | 31.4 | 21.2 | ||
All Other | ||||||
Segment Reporting Information [Line Items] | ||||||
Net sales | 0 | 31.7 | 26.8 | 59 | ||
Segment profit | 0 | 5.8 | 3.1 | 6.8 | ||
Operating Segments | ||||||
Segment Reporting Information [Line Items] | ||||||
Segment profit | 107.1 | 115.9 | 176.3 | 179 | ||
Corporate | ||||||
Segment Reporting Information [Line Items] | ||||||
General corporate and other expenses | 10.9 | 16.7 | 24.2 | 30.4 | ||
Project Fuel | ||||||
Segment Reporting Information [Line Items] | ||||||
Restructuring and related costs | 12.4 | 15.4 | 20.4 | 33.9 | ||
Project Fuel | Wet Shave | ||||||
Segment Reporting Information [Line Items] | ||||||
Restructuring and related costs | 4.2 | 4.9 | 7 | 14.5 | ||
Project Fuel | Sun and Skin Care | ||||||
Segment Reporting Information [Line Items] | ||||||
Restructuring and related costs | 0.2 | 1.7 | 0.2 | 2.2 | ||
Project Fuel | Feminine Care | ||||||
Segment Reporting Information [Line Items] | ||||||
Restructuring and related costs | 0.2 | 0.9 | 0.2 | 1.2 | ||
Project Fuel | All Other | ||||||
Segment Reporting Information [Line Items] | ||||||
Restructuring and related costs | 0.3 | 0.4 | ||||
Project Fuel | Corporate | ||||||
Segment Reporting Information [Line Items] | ||||||
Restructuring and related costs | 7.8 | 7.6 | 13 | 15.6 | ||
IT enablement | Project Fuel | Selling, general and administrative expenses | ||||||
Segment Reporting Information [Line Items] | ||||||
Restructuring and related costs | $ 5.8 | $ 1.9 | $ 7.7 | $ 3.3 | ||
[1] | Includes pre-tax SG&A of $5.8 and $7.7 for the three and six months ended March 31, 2020, respectively, and $1.9 and $3.3 for the three and six months ended March 31, 2019, respectively, associated with certain information technology enablement expenses and incentive and retention compensation expenses for Project Fuel. Additionally, includes pre-tax Cost of products sold of $0.1 for the three and six months ended March 31, 2020, related to inventory write-offs associated with Project Fuel. | |||||
[2] | Includes pre-tax SG&A of $25.5 and $31.7 for the three and six months ended March 31, 2020, respectively, and $0.5 and $1.0 for the three and six months ended March 31, 2019, respectively, related to acquisition and integration planning costs. | |||||
[3] | Includes pre-tax SG&A of $0.3 for the six months ended March 31, 2020, and $1.0 for the three and six months ended March 31, 2019. | |||||
[4] | Includes pre-tax Cost of products sold of $0.4 and $0.5 for the three and six months ended March 31, 2019, respectively. | |||||
[5] | Includes pre-tax SG&A of $0.9 for the six months ended March 31, 2019. |
Segment Data Segment Data (Sche
Segment Data Segment Data (Schedule of Sales by Geographical Area) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |
Revenue from External Customer [Line Items] | ||||
Net sales | $ 523 | $ 546.7 | $ 977 | $ 1,003.8 |
United States | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 302.3 | 310.4 | 553.4 | 561.7 |
International | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | $ 220.7 | $ 236.3 | $ 423.6 | $ 442.1 |
Segment Data (Schedule of Suppl
Segment Data (Schedule of Supplemental Product Information) (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2020 | Mar. 31, 2019 | Mar. 31, 2020 | Mar. 31, 2019 | |
Revenue from External Customer [Line Items] | ||||
Net sales | $ 523 | $ 546.7 | $ 977 | $ 1,003.8 |
Razors and blades | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 246.1 | 260.6 | 490.4 | 515.9 |
Tampons, pads and liners | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 85 | 74.6 | 160.1 | 149.3 |
Skin care products | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 42.4 | 29.7 | 80.3 | 63.9 |
Sun care products | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 115.1 | 116.3 | 152.3 | 149.5 |
Shaving gels and creams | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | 34.4 | 33.8 | 67.1 | 66.2 |
Infant care and other | ||||
Revenue from External Customer [Line Items] | ||||
Net sales | $ 0 | $ 31.7 | $ 26.8 | $ 59 |
Uncategorized Items - epc-20200
Label | Element | Value |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents, Period Increase (Decrease), Including Exchange Rate Effect | us-gaap_CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalentsPeriodIncreaseDecreaseIncludingExchangeRateEffect | $ (21,800,000) |
Cash, Cash Equivalents, Restricted Cash and Restricted Cash Equivalents, Period Increase (Decrease), Including Exchange Rate Effect | us-gaap_CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalentsPeriodIncreaseDecreaseIncludingExchangeRateEffect | $ (32,800,000) |