Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Apr. 01, 2017 | May 05, 2017 | |
Document And Entity Information [Abstract] | ||
Entity Registrant Name | SCOTTS MIRACLE-GRO CO | |
Entity Central Index Key | 825,542 | |
Current Fiscal Year End Date | --09-30 | |
Entity Filer Category | Large Accelerated Filer | |
Document Type | 10-Q | |
Document Period End Date | Apr. 1, 2017 | |
Document Fiscal Year Focus | 2,017 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false | |
Trading Symbol | SMG | |
Entity Common Stock, Shares Outstanding | 59,571,630 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Apr. 01, 2017 | Apr. 02, 2016 | Apr. 01, 2017 | Apr. 02, 2016 | |
Income Statement [Abstract] | ||||
Net sales | $ 1,203.5 | $ 1,245.2 | $ 1,450.3 | $ 1,439.7 |
Cost of sales | 701.1 | 723.5 | 903.7 | 896.3 |
Cost of sales—impairment, restructuring and other | 0 | 0.1 | 0 | 5.1 |
Gross profit | 502.4 | 521.6 | 546.6 | 538.3 |
Operating expenses: | ||||
Selling, general and administrative | 197.8 | 200.9 | 316.9 | 314.2 |
Impairment, restructuring and other | 3.3 | (47.2) | 4.7 | (45.9) |
Other income, net | (0.6) | (1.3) | (6) | (1.5) |
Income (loss) from operations | 301.9 | 369.2 | 231 | 271.5 |
Equity in loss of unconsolidated affiliates | 24.1 | 0 | 37.3 | 0 |
Costs related to refinancing | 0 | 0 | 0 | 8.8 |
Interest expense | 21.5 | 19.1 | 37.1 | 35.4 |
Income (loss) from continuing operations before income taxes | 256.3 | 350.1 | 156.6 | 227.3 |
Income tax expense from continuing operations | 91 | 124.3 | 55.6 | 80.7 |
Income from continuing operations | 165.3 | 225.8 | 101 | 146.6 |
Loss from discontinued operations, net of tax | (0.1) | (16) | (0.7) | (17.5) |
Net income (loss) | 165.2 | 209.8 | 100.3 | 129.1 |
Net (income) loss attributable to noncontrolling interest | (0.1) | 0.3 | (0.5) | (0.1) |
Net income (loss) attributable to controlling interest | $ 165.1 | $ 210.1 | $ 99.8 | $ 129 |
Basic income per common share: | ||||
Income from continuing operations (USD per share) | $ 2.76 | $ 3.68 | $ 1.68 | $ 2.39 |
Loss from discontinued operations (USD per share) | 0 | (0.26) | (0.01) | (0.29) |
Basic income per common share (USD per share) | $ 2.76 | $ 3.42 | $ 1.67 | $ 2.10 |
Weighted-average common shares outstanding during the period (shares) | 59.8 | 61.4 | 60 | 61.4 |
Diluted income per common share: | ||||
Income from continuing operations (USD per share) | $ 2.73 | $ 3.64 | $ 1.65 | $ 2.35 |
Loss from discontinued operations (USD per share) | 0 | (0.26) | (0.01) | (0.28) |
Diluted Income per common share (USD per share) | $ 2.73 | $ 3.38 | $ 1.64 | $ 2.07 |
Weighted-average common shares outstanding during the period plus dilutive potential common shares (shares) | 60.6 | 62.2 | 60.9 | 62.4 |
Dividends declared per common share (USD per share) | $ 0.5 | $ 0.47 | $ 1 | $ 0.94 |
Condensed Consolidated Stateme3
Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Apr. 01, 2017 | Apr. 02, 2016 | Apr. 01, 2017 | Apr. 02, 2016 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 165.2 | $ 209.8 | $ 100.3 | $ 129.1 |
Other comprehensive income: | ||||
Net foreign currency translation adjustment | 1.8 | 0.3 | (2.2) | (2.5) |
Net unrealized gain (loss) on derivative instruments, net of tax of $0.0, $1.8, $1.9 and $1.0, respectively | 0 | (2.9) | 3 | (1.6) |
Reclassification of net unrealized losses on derivatives to net income, net of tax of $0.7, $1.7, $0.9 and $2.2, respectively | 1.1 | 2.8 | 1.5 | 3.6 |
Reclassification of net pension and post-retirement benefit loss to net income, net of tax of $0.3, $0.1, $0.6 and $0.4, respectively | 0.5 | 0.2 | 0.9 | 0.7 |
Total other comprehensive income | 3.4 | 0.4 | 3.2 | 0.2 |
Comprehensive income | $ 168.6 | $ 210.2 | $ 103.5 | $ 129.3 |
Condensed Consolidated Stateme4
Condensed Consolidated Statements of Comprehensive Income (Loss) (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Apr. 01, 2017 | Apr. 02, 2016 | Apr. 01, 2017 | Apr. 02, 2016 | |
Statement of Comprehensive Income [Abstract] | ||||
Net unrealized gains (losses) on derivatives - tax impact | $ 0 | $ 1.8 | $ 1.9 | $ 1 |
Reclassification of net unrealized losses on derivatives - tax impact | 0.7 | 1.7 | 0.9 | 2.2 |
Reclassification of pension and post-retirement benefit loss - tax impact | $ 0.3 | $ 0.1 | $ 0.6 | $ 0.4 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Millions | 6 Months Ended | |
Apr. 01, 2017 | Apr. 02, 2016 | |
OPERATING ACTIVITIES | ||
Net income | $ 100.3 | $ 129.1 |
Adjustments to reconcile net income to net cash used in operating activities: | ||
Costs related to refinancing | 0 | 2.2 |
Share-based compensation expense | 15.1 | 11.3 |
Depreciation | 27.6 | 27.3 |
Amortization | 12.3 | 9.5 |
(Gain) loss on long-lived assets | 0.8 | (0.3) |
Adjustment to gain on contribution of SLS Business | (0.3) | 0 |
Equity in loss and distributions from unconsolidated affiliates | 39.5 | 0 |
Changes in assets and liabilities, net of acquired businesses: | ||
Accounts receivable | (749.9) | (834.6) |
Inventories | (207.9) | (224.3) |
Prepaid and other assets | (29) | (48.2) |
Accounts payable | 167.1 | 105 |
Other current liabilities | 148.1 | 207.5 |
Restructuring reserves | (14.6) | (8.9) |
Other non-current items | (7) | (2.8) |
Other, net | 0.1 | (0.6) |
Net cash used in operating activities | (497.8) | (627.8) |
INVESTING ACTIVITIES | ||
Proceeds from sale of long-lived assets | 4.8 | 0.2 |
Investments in property, plant and equipment | (32.8) | (24.4) |
Investments in loan receivable | 0 | (72) |
Investments in unconsolidated affiliates | (0.2) | (2) |
Investments in acquired businesses, net of cash acquired | (77.9) | 0 |
Net cash used in investing activities | (106.1) | (98.2) |
FINANCING ACTIVITIES | ||
Borrowings under revolving and bank lines of credit and term loans | 944.6 | 1,573.2 |
Repayments under revolving and bank lines of credit and term loans | (395) | (959.8) |
Proceeds from issuance of Senior Notes | 250 | 400 |
Repayment of 6.625% Senior Notes | 0 | (200) |
Financing and issuance fees | (3.9) | (10.5) |
Dividends paid | (59.9) | (57.7) |
Distribution paid by AeroGrow to noncontrolling interest | (8.1) | 0 |
Purchase of Common Shares | (90.4) | (42.8) |
Payments on seller notes | (13.2) | (2.3) |
Excess tax benefits from share-based payment arrangements | 4 | 4.2 |
Cash received from the exercise of stock options | 1.7 | 9.2 |
Net cash provided by financing activities | 629.8 | 713.5 |
Effect of exchange rate changes on cash | (1.7) | (1.6) |
Net increase (decrease) in cash and cash equivalents | 24.2 | (14.1) |
Cash and cash equivalents at beginning of period | 50.1 | 71.4 |
Cash and cash equivalents at end of period | 74.3 | 57.3 |
Senior Notes – 5.250% | ||
FINANCING ACTIVITIES | ||
Proceeds from issuance of Senior Notes | 250 | 0 |
Senior Notes – 6.000% | ||
FINANCING ACTIVITIES | ||
Proceeds from issuance of Senior Notes | $ 0 | $ 400 |
Condensed Consolidated Stateme6
Condensed Consolidated Statements of Cash Flows (Parenthetical) - Senior Notes | Apr. 01, 2017 | Apr. 02, 2016 | Dec. 15, 2015 |
Senior Notes – 5.250% | |||
Interest rate of debt | 5.25% | ||
Senior Notes – 6.000% | |||
Interest rate of debt | 6.00% | 6.00% | |
Senior Notes - 6.625% | |||
Interest rate of debt | 6.625% | 6.625% |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Millions | Apr. 01, 2017 | Sep. 30, 2016 | Apr. 02, 2016 |
Current assets: | |||
Cash and cash equivalents | $ 74.3 | $ 50.1 | $ 57.3 |
Accounts receivable, less allowances of $9.0, $14.9 and $7.2, respectively | 1,121.3 | 196.4 | 954.7 |
Accounts receivable pledged | 0 | 174.7 | 208.4 |
Inventories | 658.5 | 448.2 | 619.6 |
Assets held for sale | 0 | 0 | 208.7 |
Prepaid and other current assets | 155.5 | 122.3 | 160.1 |
Total current assets | 2,009.6 | 991.7 | 2,208.8 |
Investment in unconsolidated affiliates | 59.9 | 101 | 0 |
Property, plant and equipment, net of accumulated depreciation of $636.2, $614.5 and $633.3, respectively | 460.9 | 470.8 | 436.3 |
Goodwill | 401.9 | 373.2 | 284.9 |
Intangible assets, net | 785.7 | 750.9 | 646.8 |
Other assets | 120.4 | 115.2 | 102.5 |
Total assets | 3,838.4 | 2,802.8 | 3,679.3 |
Current liabilities: | |||
Current portion of debt | 32.1 | 185 | 202.9 |
Accounts payable | 322.6 | 165.9 | 293.8 |
Liabilities held for sale | 0 | 0 | 62.1 |
Other current liabilities | 390 | 242.2 | 427.1 |
Total current liabilities | 744.7 | 593.1 | 985.9 |
Long-term debt | 2,055.1 | 1,125.1 | 1,758.5 |
Other liabilities | 347.2 | 350.3 | 247 |
Total liabilities | 3,147 | 2,068.5 | 2,991.4 |
Commitments and contingencies (Note 12) | |||
Equity: | |||
Common shares and capital in excess of $.01 stated value per share; 59.6, 61.2 and 60.3 shares issued and outstanding, respectively | 399.8 | 401.7 | 401.9 |
Retained earnings | 921 | 881.8 | 756.4 |
Treasury shares, at cost; 8.5, 6.9 and 7.8 shares, respectively | (528.2) | (451.4) | (376.3) |
Accumulated other comprehensive loss | (113.7) | (116.9) | (106.6) |
Total equity—controlling interest | 678.9 | 715.2 | 675.4 |
Noncontrolling interest | 12.5 | 19.1 | 12.5 |
Total equity | 691.4 | 734.3 | 687.9 |
Total liabilities and equity | $ 3,838.4 | $ 2,802.8 | $ 3,679.3 |
Condensed Consolidated Balance8
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) shares in Millions, $ in Millions | Apr. 01, 2017 | Sep. 30, 2016 | Apr. 02, 2016 |
Statement of Financial Position [Abstract] | |||
Accounts receivable, allowances | $ 9 | $ 7.2 | $ 14.9 |
Property, plant and equipment, accumulated depreciation | $ 636.2 | $ 633.3 | $ 614.5 |
Common shares stated value (USD per share) | $ 0.01 | $ 0.01 | $ 0.01 |
Common shares issued (shares) | 59.6 | 60.3 | 61.2 |
Common shares outstanding (shares) | 59.6 | 60.3 | 61.2 |
Treasury shares, at cost (shares) | 8.5 | 7.8 | 6.9 |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Apr. 01, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Nature of Operations The Scotts Miracle-Gro Company (“Scotts Miracle-Gro” or “Parent”) and its subsidiaries (collectively, together with Scotts Miracle-Gro, the “Company”) are engaged in the manufacturing, marketing and sale of consumer branded products for lawn and garden care. The Company’s primary customers include home centers, mass merchandisers, warehouse clubs, large hardware chains, independent hardware stores, nurseries, garden centers, food and drug stores, and indoor gardening and hydroponic stores. The Company’s products are sold primarily in North America and the European Union. Prior to April 13, 2016, the Company operated the Scotts LawnService ® business (the “SLS Business”), which provided residential and commercial lawn care, tree and shrub care and pest control services in the United States. On April 13, 2016 , pursuant to the terms of the Contribution and Distribution Agreement (the “Contribution Agreement”) between the Company and TruGreen Holding Corporation (“TruGreen Holdings”), the Company completed the contribution of the SLS Business to a newly formed subsidiary of TruGreen Holdings (the “TruGreen Joint Venture”) in exchange for a minority equity interest of 30% in the TruGreen Joint Venture. As a result, effective in its second quarter of fiscal 2016, the Company classified its results of operations for all periods presented to reflect the SLS Business as a discontinued operation and classified the assets and liabilities of the SLS Business as held for sale. See “NOTE 2. DISCONTINUED OPERATIONS” and “NOTE 4. INVESTMENT IN UNCONSOLIDATED AFFILIATES” for further discussion. Refer to “ NOTE 15. SEGMENT INFORMATION ” for discussion of the Company’s new reportable segments identified effective in the second quarter of fiscal 2016. Due to the nature of the consumer lawn and garden business, the majority of the Company’s sales to customers occur in the Company’s second and third fiscal quarters. On a combined basis, net sales for the second and third quarters of the last three fiscal years represented in excess of 75% of the Company’s annual net sales. Organization and Basis of Presentation The Company’s unaudited condensed consolidated financial statements for the three and six months ended April 1, 2017 and April 2, 2016 are presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”). The condensed consolidated financial statements include the accounts of Scotts Miracle-Gro and its subsidiaries. All intercompany transactions and accounts have been eliminated in consolidation. The Company’s consolidation criteria are based on majority ownership (as evidenced by a majority voting interest in the entity) and an objective evaluation and determination of effective management control. AeroGrow International, Inc. (“AeroGrow”) and Gavita Holdings B.V., and its subsidiaries (collectively, “Gavita”), in which the Company has controlling interests, are consolidated, with the equity owned by other shareholders shown as noncontrolling interest in the Condensed Consolidated Balance Sheets, and the other shareholders’ portion of net earnings and other comprehensive income shown as net income (loss) or comprehensive income attributable to noncontrolling interest in the Condensed Consolidated Statements of Operations and Condensed Consolidated Statements of Comprehensive Income (Loss), respectively. In the opinion of management, interim results reflect all normal and recurring adjustments and are not necessarily indicative of results for a full year. Certain information and footnote disclosures normally included in financial statements prepared in accordance with GAAP have been omitted or condensed pursuant to the rules and regulations of the Securities and Exchange Commission (“SEC”). Accordingly, this report should be read in conjunction with Scotts Miracle-Gro’s Annual Report on Form 10-K for the fiscal year ended September 30, 2016 (the “2016 Annual Report”), which includes a complete set of footnote disclosures, including the Company’s significant accounting policies. The Company’s Condensed Consolidated Balance Sheet at September 30, 2016 has been derived from the Company’s audited Consolidated Balance Sheet at that date, but does not include all of the information and footnotes required by GAAP for complete financial statements. Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes and related disclosures. Although these estimates are based on management’s best knowledge of current events and actions the Company may undertake in the future, actual results ultimately may differ from the estimates. Loans Receivable Loans receivable are carried at outstanding principal amount, and are recognized in the “Other assets” line in the Condensed Consolidated Balance Sheets. Loans receivable are impaired when, based on current information and events, it is probable that the Company will be unable to collect all amounts due according to the contractual terms of the loan agreement. If it is determined that an impairment has occurred, an impairment loss is recognized for the amount by which the carrying value of the asset exceeds the present value of expected future cash flows and recorded within “Operating expenses” in the Condensed Consolidated Statements of Operations. Interest income is recorded on an accrual basis, and is recognized in the “Other income, net” line in the Condensed Consolidated Statements of Operations. Interest income was $2.1 million and $0.4 million for the three months ended April 1, 2017 and April 2, 2016 , respectively. Interest income was $4.8 million and $0.4 million for the six months ended April 1, 2017 and April 2, 2016 , respectively. Long-Lived Assets The Company had non-cash investing activities of $2.3 million and $3.7 million during the six months ended April 1, 2017 and April 2, 2016 , respectively, representing unpaid liabilities incurred during each period to acquire property, plant and equipment. Statements of Cash Flows Supplemental cash flow information was as follows for each of the periods presented: SIX MONTHS ENDED APRIL 1, APRIL 2, (In millions) Interest paid $ (26.5 ) $ (23.0 ) Call premium on 6.625% Senior Notes — (6.6 ) Income taxes paid (3.2 ) (2.2 ) During the three months ended April 1, 2017 , Scotts Miracle-Gro’s wholly-owned subsidiary, Scotts Canada Ltd., paid contingent consideration of $6.7 million related to the fiscal 2014 acquisition of Fafard & Brothers Ltd. (“Fafard”). The Company uses the “cumulative earnings” approach for determining cash flow presentation of distributions from unconsolidated affiliates. Distributions received are included in the Condensed Consolidated Statements of Cash Flows as operating activities, unless the cumulative distributions exceed the portion of the cumulative equity in the net earnings of the unconsolidated affiliate, in which case the excess distributions are deemed to be returns of the investment and are classified as investing activities in the Condensed Consolidated Statements of Cash Flows. RECENT ACCOUNTING PRONOUNCEMENTS Debt Issuance Costs In April 2015, the Financial Accounting Standards Board (“FASB”) issued an accounting standard update that requires debt issuance costs related to a recognized debt liability to be presented in the balance sheet as a direct deduction from the corresponding debt liability rather than as an asset; however debt issuance costs relating to revolving credit facilities will remain in other assets. The Company adopted this guidance on a retrospective basis effective October 1, 2016. As a result, debt issuance costs totaling $6.3 million and $6.0 million have been presented as a component of the carrying amount of long-term debt in the Condensed Consolidated Balance Sheets as of April 2, 2016 and September 30, 2016 , respectively. These amounts were previously reported within other assets. Business Combinations In September 2015, the FASB issued an accounting standard update to simplify the accounting for measurement-period adjustments by requiring an acquirer to recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined, and requiring disclosure of the portion of the amount recorded in current period earnings by line item that would have been recorded in previous reporting periods if the adjustment to the provisional amounts had been recognized as of the acquisition date. The Company adopted this guidance on a prospective basis effective October 1, 2016. The adoption of this guidance did not impact the Company’s consolidated financial position, results of operations or cash flows. Revenue Recognition from Contracts with Customers In May 2014, the FASB issued amended accounting guidance that replaces most existing revenue recognition guidance under GAAP. This guidance requires companies to recognize revenue in a manner that depicts the transfer of promised goods or services to customers in amounts that reflect the consideration to which a company expects to be entitled in exchange for those goods or services. The new standard also will result in enhanced disclosures about the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. Subsequently, additional guidance was issued on several areas including guidance intended to improve the operability and understandability of the implementation of principal versus agent considerations and clarifications on the identification of performance obligations and implementation of guidance related to licensing. The provisions are effective for the Company’s financial statements no later than the fiscal year beginning October 1, 2018. The standard allows for either a full retrospective or a modified retrospective transition method. The Company is currently evaluating the impact of this standard on its consolidated results of operations, financial position and cash flows. Inventory In July 2015, the FASB issued an accounting standard update that requires inventory to be measured “at the lower of cost and net realizable value,” thereby simplifying the current guidance that requires inventory to be measured at the lower of cost or market (market in this context is defined as one of three different measures, one of which is net realizable value). The provisions are effective prospectively for the Company’s financial statements for the fiscal year beginning October 1, 2017, and are not expected to have a significant impact on the Company’s consolidated financial position, results of operations or cash flows. Income Taxes In November 2015, the FASB issued an accounting standard update to simplify the presentation of deferred income taxes by requiring that deferred income tax liabilities and assets be classified as noncurrent in a classified statement of financial position. The provisions are effective for the Company’s financial statements no later than the fiscal year beginning October 1, 2017. The standard allows for either a retrospective or prospective transition method and is not expected to have a significant impact on the Company’s consolidated financial position, results of operations or cash flows. At April 1, 2017 , April 2, 2016 and September 30, 2016 , net current deferred tax assets classified within prepaid and other current assets were $61.4 million , $72.4 million and $62.1 million , respectively. Leases In February 2016, the FASB issued an accounting standard update which significantly changes the accounting for leases. This guidance requires lessees to recognize a lease liability for the obligation to make lease payments and a right-of-use asset for the right to use the underlying asset for the lease term. The provisions are effective for the Company’s financial statements no later than the fiscal year beginning October 1, 2019 and require a modified retrospective transition approach for leases that exist or are entered into after the beginning of the earliest comparative period presented in the financial statements. The Company is currently evaluating the impact of this standard on its consolidated results of operations, financial position and cash flows. Share-Based Compensation In March 2016, the FASB issued an accounting standard update that simplifies several aspects of the accounting for employee share-based payment transactions, including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classification in the statement of cash flows. The provisions are effective, using a combination of retrospective, modified retrospective and prospective transition methods, for the Company’s financial statements no later than the fiscal year beginning October 1, 2017. The Company is currently evaluating the impact of this standard on its consolidated results of operations, financial position and cash flows. Cash Flow Presentation In August 2016, the FASB issued an accounting standard update that amends the guidance on the classification of certain cash receipts and payments in the statement of cash flows. The provisions are effective retrospectively for the Company’s financial statements no later than the fiscal year beginning October 1, 2018, and are not expected to have a significant impact on the Company’s consolidated cash flows. Business Combinations In January 2017, the FASB issued an accounting standard update that clarifies the definition of a business to provide additional guidance to assist in evaluating whether transactions should be accounted for as an acquisition (or disposal) of either an asset or business. The provisions are effective prospectively for the Company’s financial statements no later than the fiscal year beginning October 1, 2018, and are not expected to have a significant impact on the Company’s consolidated financial position, results of operations or cash flows. Goodwill In January 2017, the FASB issued an accounting standard update which removes the requirement to compare the implied fair value of goodwill with its carrying amount as part of step 2 of the goodwill impairment test. Goodwill impairment will now be the amount by which a reporting unit’s carrying value exceeds its fair value, not to exceed the carrying amount of the goodwill. The provisions are effective prospectively for the Company’s financial statements no later than the fiscal year beginning October 1, 2020, and are not expected to have a significant impact on the Company’s consolidated financial position, results of operations or cash flows. Employee Benefit Plans In March 2017, the FASB issued an accounting standard update which requires entities to (1) disaggregate the current-service-cost component from the other components of net benefit cost (the “other components”) and present it with other current compensation costs for related employees in the income statement, (2) present the other components elsewhere in the income statement and outside of income from operations if that subtotal is presented and (3) limit the amount of costs eligible for capitalization (e.g., as part of inventory or property, plant, and equipment) to only the service-cost component of net benefit cost. The provisions are effective for the Company’s financial statements no later than the fiscal year beginning October 1, 2018, and are required to be applied retrospectively for the presentation of cost components in the income statement and prospectively for the capitalization of cost components. The provisions are not expected to have a significant impact on the Company’s consolidated financial position, results of operations or cash flows. |
DISCONTINUED OPERATIONS
DISCONTINUED OPERATIONS | 6 Months Ended |
Apr. 01, 2017 | |
Discontinued Operations and Disposal Groups [Abstract] | |
DISCONTINUED OPERATIONS | DISCONTINUED OPERATIONS On April 13, 2016 , pursuant to the terms of the Contribution Agreement, the Company completed the contribution of the SLS Business to the TruGreen Joint Venture in exchange for a minority equity interest of 30% in the TruGreen Joint Venture. As a result, effective in its second quarter of fiscal 2016, the Company classified its results of operations for all periods presented to reflect the SLS Business as a discontinued operation and classified the assets and liabilities of the SLS Business as held for sale. The Company recorded a gain on the contribution of $131.2 million , partially offset by the provision for deferred income taxes of $51.9 million , during fiscal 2016 within results from discontinued operations. During the three and six months ended April 1, 2017 , the Company recognized $0.1 million and $0.7 million , respectively, in transaction related costs associated with the divestiture of the SLS Business. In addition, during the six months ended April 1, 2017 , the Company recorded an adjustment to the gain on the contribution of $0.3 million related to a post closing working capital adjustment. During the three and six months ended April 2, 2016 , the Company recognized $9.0 million for the resolution of a prior SLS Business litigation matter, as well as $1.6 million and $4.6 million , respectively, in transaction related costs associated with the divestiture of the SLS Business. The following table summarizes the results of the SLS Business within discontinued operations for each of the periods presented: THREE MONTHS ENDED SIX MONTHS ENDED APRIL 1, APRIL 2, APRIL 1, APRIL 2, (In millions) Net sales $ — $ 40.9 $ — $ 92.0 Operating costs — 55.7 — 107.1 Impairment, restructuring and other 0.1 10.6 0.7 13.6 Other income, net — (0.7 ) — (1.5 ) Adjustment to gain on contribution of SLS Business — — 0.3 — Loss from discontinued operations before income taxes (0.1 ) (24.7 ) (1.0 ) (27.2 ) Income tax benefit from discontinued operations — (8.7 ) (0.3 ) (9.7 ) Loss from discontinued operations, net of tax $ (0.1 ) $ (16.0 ) $ (0.7 ) $ (17.5 ) The following table summarizes the major classes of assets and liabilities of the SLS Business held for sale as of April 2, 2016 (in millions): Accounts receivable, net $ 17.2 Inventories 13.8 Prepaid and other assets 13.1 Property, plant and equipment, net 8.4 Goodwill and intangible assets, net 156.2 Assets held for sale $ 208.7 Current portion of debt $ 0.3 Accounts payable 4.5 Other current liabilities 52.1 Long-term debt 3.3 Other liabilities 1.9 Liabilities held for sale $ 62.1 The Condensed Consolidated Statements of Cash Flows do not present the cash flows from discontinued operations separately from cash flows from continuing operations. Cash used in operating activities related to the SLS Business was $9.3 million for the six months ended April 1, 2017 primarily due to the payment of a previously accrued SLS Business litigation matter. Cash provided by operating activities related to the SLS Business was $12.2 million for the six months ended April 2, 2016 . Cash used in investing activities related to the SLS Business was zero and $0.1 million for the six months ended April 1, 2017 and April 2, 2016 , respectively. |
ACQUISITION AND INVESTMENTS
ACQUISITION AND INVESTMENTS | 6 Months Ended |
Apr. 01, 2017 | |
Business Combinations [Abstract] | |
ACQUISITIONS AND INVESTMENTS | ACQUISITIONS AND INVESTMENTS Fiscal 2017 On October 3, 2016 , the Company, through its wholly-owned subsidiary The Hawthorne Gardening Company, completed the acquisition of American Agritech, L.L.C., d/b/a Botanicare (“Botanicare”), an Arizona-based leading producer of plant nutrients, plant supplements and growing systems used for hydroponic gardening, for $92.6 million . The purchase price included contingent consideration, a non-cash investing activity, with a maximum payout and estimated fair value of $15.5 million , which was paid subsequent to April 1, 2017 . The preliminary valuation of the acquired assets included (i) $1.2 million of cash, prepaid and other current assets, (ii) $8.4 million of inventory and accounts receivable, (iii) $1.4 million of fixed assets, (iv) $2.3 million of accounts payable and other current liabilities, (v) $53.0 million of finite-lived identifiable intangible assets, and (vi) $30.9 million of tax-deductible goodwill. Identifiable intangible assets included tradenames, customer relationships and non-compete arrangements with useful lives ranging between 5 and 25 years. The estimated fair values of the identifiable intangible assets were determined using an income-based approach, which includes market participant expectations of cash flows that an asset will generate over the remaining useful life discounted to present value using an appropriate discount rate. Net sales for Botanicare included within the Other segment for the three and six months ended April 1, 2017 were $11.3 million and $21.2 million , respectively. During the first quarter of fiscal 2017, the Company’s U.S. Consumer segment completed two acquisitions of companies whose products support the Company’s focus on the emerging areas of water positive landscapes and internet-enabled technology for an aggregate purchase price of $3.2 million . The valuation of the acquired assets for the transactions included finite-lived identifiable intangible assets and goodwill of $2.8 million . Fiscal 2016 On May 26, 2016, the Company, through its wholly-owned subsidiary The Hawthorne Gardening Company, acquired majority control and a 75% economic interest in Gavita for $136.2 million . The remaining 25% interest was retained by Gavita’s former ownership group. This transaction provides the Company’s Other segment with a presence in the lighting category of indoor and urban gardening, which is a part of the Company’s long-term growth strategy. Gavita, which is based in the Netherlands, is a leading producer and marketer of indoor lighting used in the greenhouse and hydroponic markets, predominately in the United States and Europe. The purchase price included contingent consideration with an estimated fair value of $2.5 million , the payment of which will depend on the performance of the business through calendar year 2019. The valuation of the acquired assets included (i) $6.4 million of cash, prepaid and other current assets, (ii) $38.3 million of inventory and accounts receivable, (iii) $1.5 million of fixed assets, (iv) $18.7 million of accounts payable and other current liabilities, (v) $5.5 million of short term debt, (vi) $102.6 million of finite-lived identifiable intangible assets, (vii) $82.7 million of non-deductible goodwill, and (viii) $25.7 million of deferred tax liabilities. Identifiable intangible assets included tradenames, customer relationships and non-compete arrangements with useful lives ranging between 5 and 25 years. The estimated fair values of the identifiable intangible assets were determined using an income-based approach, which includes market participant expectations of cash flows that an asset will generate over the remaining useful life discounted to present value using an appropriate discount rate. Gavita’s former ownership group has retained a 25% noncontrolling interest in Gavita consisting of ownership of 5% of the outstanding shares of Gavita and a loan with interest payable based on distributions by Gavita. The loan represented a non-cash financing activity and is recorded at fair value in the “Long-term debt” line in the Condensed Consolidated Balance Sheets. The initial valuation of the loan was $37.7 million . The fair value measurement was classified in Level 3 of the fair value hierarchy. Net sales for Gavita included within the Other segment for the three and six months ended April 1, 2017 were $24.1 million and $50.7 million , respectively. In the third quarter of fiscal 2016, the Company completed an acquisition within the Other segment to expand its Canadian growing media operations for $33.9 million . The purchase price included contingent consideration with an estimated fair value of $10.8 million , of which $6.5 million was paid during the first quarter of fiscal 2017. The payment of the remaining amount will depend on the performance of the business in fiscal 2017. The valuation of the acquired assets included (i) $4.7 million of inventory and accounts receivable, (ii) $18.6 million of fixed assets, (iii) $11.4 million of finite-lived identifiable intangible assets, (iv) $1.4 million of deferred tax liabilities, (v) an investment in an unconsolidated joint venture of $0.7 million , and (vi) $2.1 million of tax-deductible goodwill. Identifiable intangible assets included peat bog lease rights, tradenames, customer relationships and non-compete arrangements with useful lives ranging between 5 and 25 years. The estimated fair values of the identifiable intangible assets were determined using an income-based approach, which includes market participant expectations of cash flows that an asset will generate over the remaining useful life discounted to present value using an appropriate discount rate. Net sales related to this acquisition included within the Other segment for the three and six months ended April 1, 2017 were $3.6 million and $7.3 million , respectively. In the second quarter of fiscal 2016, the Company entered into definitive agreements with Bonnie Plants, Inc. (“Bonnie”) and its sole shareholder, Alabama Farmers Cooperative, Inc. (“AFC”), providing for the Company’s participation in Bonnie’s business of planting, growing, developing, manufacturing, distributing, marketing, and selling live plants, plant food, fertilizer and potting soil (the “Bonnie Business”). The Company’s participation includes a Term Loan Agreement from the Company to AFC, with Bonnie as guarantor, in the amount of $72.0 million with a fixed coupon rate of 6.95% (the “Term Loan”) as well as a Marketing, R&D and Ancillary Services Agreement (the “Services Agreement”) pursuant to which the Company provides marketing, research and development and certain ancillary services to Bonnie for a commission fee based on the profits of the Bonnie Business and the reimbursement of certain costs. During the three and six months ended April 1, 2017 , the Company recognized cost reimbursements of $0.6 million and $1.6 million , respectively, as compared to $0.2 million during the three and six months ended April 2, 2016 . These agreements also include options beginning in fiscal 2020 that provide for either (i) the Company to increase its economic interest in the Bonnie Business or (ii) AFC and Bonnie to repurchase the Company’s economic interest in the Bonnie Business. The Company’s option to increase its economic interest in the Bonnie Business (the “Bonnie Option”) is required to be accounted for as a derivative instrument and is recorded at fair value in the “Other assets” line in the Condensed Consolidated Balance Sheets, with changes in fair value recognized in the “Other income (loss), net” line in the Condensed Consolidated Statement of Operations. The estimated fair value of the Bonnie Option was determined using a simulation approach, whereby the total value of the loan receivable and optional exchange for additional equity was estimated considering a distribution of possible future cash flows discounted to present value using an appropriate discount rate. The estimated fair value of the Bonnie Option was $10.9 million as of April 1, 2017 , and the fair value measurement was classified in Level 3 of the fair value hierarchy. The condensed consolidated financial statements include the results of operations for these business combinations from the date of each acquisition. |
INVESTMENT IN UNCONSOLIDATED AF
INVESTMENT IN UNCONSOLIDATED AFFILIATES | 6 Months Ended |
Apr. 01, 2017 | |
Equity Method Investments and Joint Ventures [Abstract] | |
INVESTMENT IN UNCONSOLIDATED AFFILIATES | INVESTMENT IN UNCONSOLIDATED AFFILIATES As of April 1, 2017 , the Company held a minority equity interest of 30% in the TruGreen Joint Venture. This interest had an initial fair value of $294.0 million and subsequently is accounted for using the equity method of accounting, with the Company’s proportionate share of the TruGreen Joint Venture earnings reflected in the Condensed Consolidated Statements of Operations. In addition, the Company and TruGreen Holdings entered into a limited liability company agreement (the “LLC Agreement”) governing the management of the TruGreen Joint Venture, as well as certain ancillary agreements including a transition services agreement and an employee leasing agreement. The LLC Agreement provides the Company with minority representation on the board of directors of the TruGreen Joint Venture. In connection with the closing of the transactions contemplated by the Contribution Agreement on April 13, 2016 , the TruGreen Joint Venture obtained debt financing and made an excess distribution of $196.2 million to the Company, and the Company invested $18.0 million in second lien term loan financing to the TruGreen Joint Venture. The Company was reimbursed $14.7 million and $33.7 million during the three and six months ended April 1, 2017 , respectively, and has accounts receivable of $8.3 million at April 1, 2017 , for expenses incurred pursuant to a short-term transition services agreement and an employee leasing agreement, and also has an indemnification asset of $7.4 million at April 1, 2017 for future payments on claims associated with insurance programs. The Company received distributions from unconsolidated affiliates intended to cover required tax payments of zero and $2.2 million during the three and six months ended April 1, 2017 , respectively. The following table presents summarized financial information for the TruGreen Joint Venture for each of the periods presented: THREE MONTHS ENDED SIX MONTHS ENDED APRIL 1, APRIL 1, (in millions) Net sales $ 154.7 $ 406.8 Gross margin 9.7 70.8 Depreciation and amortization 36.6 56.8 Interest expense 16.6 33.5 Selling, general, administrative and other 36.6 78.0 Restructuring and other charges — 26.6 Net loss $ (80.1 ) $ (124.1 ) Net loss does not include income taxes, which are recognized and paid by the partners of the TruGreen Joint Venture. The income taxes associated with the Company’s share of net loss have been recorded in the “Income tax expense from continuing operations” line in the Condensed Consolidated Statement of Operations. The Company recognized equity in loss of unconsolidated affiliates of $24.1 million and $37.3 million for the three and six months ended April 1, 2017 , respectively. Included within loss of unconsolidated affiliates for the three and six months ended April 1, 2017 are charges of $2.1 million and $11.7 million , respectively, which represent the Company’s share of restructuring and other charges incurred by the TruGreen Joint Venture. These charges included zero and $7.9 million for nonrecurring integration and separation costs and $2.1 million and $3.8 million for a non-cash purchase accounting fair value write down adjustment related to deferred revenue and advertising for the three and six months ended April 1, 2017 , respectively. |
IMPAIRMENT, RESTRUCTURING AND O
IMPAIRMENT, RESTRUCTURING AND OTHER | 6 Months Ended |
Apr. 01, 2017 | |
Restructuring and Related Activities [Abstract] | |
IMPAIRMENT, RESTRUCTURING AND OTHER | IMPAIRMENT, RESTRUCTURING AND OTHER Activity described herein is classified within the “Cost of sales—impairment, restructuring and other,” “Impairment, restructuring and other” and “Income from discontinued operations, net of tax” lines in the Condensed Consolidated Statements of Operations. The following table details impairment, restructuring and other charges (recoveries) for each of the periods presented: THREE MONTHS ENDED SIX MONTHS ENDED APRIL 1, APRIL 2, APRIL 1, APRIL 2, (In millions) Cost of sales—impairment, restructuring and other: Restructuring and other charges $ — $ 0.1 $ — $ 5.1 Operating expenses: Restructuring and other charges (recoveries) 3.3 (47.2 ) 4.7 (45.9 ) Impairment, restructuring and other charges (recoveries) from continuing operations $ 3.3 $ (47.1 ) $ 4.7 $ (40.8 ) Restructuring and other charges from discontinued operations 0.1 10.6 0.7 13.6 Total impairment, restructuring and other charges (recoveries) $ 3.4 $ (36.5 ) $ 5.4 $ (27.2 ) The following table summarizes the activity related to liabilities associated with restructuring and other, excluding insurance reimbursement recoveries, during the six months ended April 1, 2017 (in millions): Amounts reserved for restructuring and other at September 30, 2016 $ 20.8 Restructuring and other charges from continuing operations 4.7 Restructuring and other charges from discontinued operations 0.7 Payments and other (20.0 ) Amounts reserved for restructuring and other at April 1, 2017 $ 6.2 Included in the restructuring reserves, as of April 1, 2017 , is $1.3 million that is classified as long-term. Payments against the long-term reserves will be incurred as the employees covered by the restructuring plan retire or through the passage of time. The remaining amounts reserved will continue to be paid out over the course of the next twelve months. In the first quarter of fiscal 2016, the Company announced a series of initiatives called Project Focus designed to maximize the value of its non-core assets and focus on emerging categories of the lawn and garden industry in its core U.S. business. During the three and six months ended April 1, 2017 , the Company’s Corporate function recognized costs of $3.3 million and $4.7 million , respectively, as compared to costs of $1.7 million and $2.6 million for the three and six months ended April 2, 2016 , respectively, related to Project Focus transaction activity within the “Impairment, restructuring and other” line in the Condensed Consolidated Statements of Operations. Costs incurred to date since the inception of the current initiatives are $3.4 million for the U.S. Consumer segment related to termination benefits, $2.0 million for the Europe Consumer segment related to termination benefits and $9.3 million for Corporate related to transaction activity. During the third quarter of fiscal 2015, the Company’s U.S. Consumer segment began experiencing an increase in certain consumer complaints related to the reformulated Bonus ® S fertilizer product sold in the southeastern United States during fiscal 2015 indicating customers were experiencing damage to their lawns after application. There have been no costs recognized by the Company related to this matter during the three and six months ended April 1, 2017 . During the three and six months ended April 2, 2016 , the Company incurred $1.0 million and $6.4 million , respectively, in costs related to resolving these consumer complaints and the recognition of costs the Company expected to incur for consumer claims within the “Impairment, restructuring and other” and the “Cost of sales—impairment, restructuring and other” lines in the Condensed Consolidated Statements of Operations. Additionally, the Company recorded offsetting insurance reimbursement recoveries of $50.0 million in the second quarter of fiscal 2016 within the “Impairment, restructuring and other” line in the Condensed Consolidated Statements of Operations. Costs incurred to date since the inception of this matter were $73.8 million , partially offset by insurance reimbursement recoveries of $60.8 million . On April 13, 2016, as part of Project Focus, the Company completed the contribution of the SLS Business to the TruGreen Joint Venture. As a result, effective in its second quarter of fiscal 2016, the Company classified its results of operations for all periods presented to reflect the SLS Business as a discontinued operation and classified the assets and liabilities of the SLS Business as held for sale. Refer to “NOTE 2. DISCONTINUED OPERATIONS” for more information. During the three and six months ended April 1, 2017 , the Company recognized $0.1 million and $0.7 million , respectively, in transaction related costs associated with the divestiture of the SLS Business within the “Loss from discontinued operations, net of tax” line in the Condensed Consolidated Statements of Operations. During the three and six months ended April 2, 2016 , the Company recognized $9.0 million for the resolution of a prior SLS Business litigation matter, as well as $1.6 million and $4.6 million , respectively, in transaction related costs associated with the divestiture of the SLS Business within the “Loss from discontinued operations, net of tax” line in the Condensed Consolidated Statements of Operations. |
INVENTORIES
INVENTORIES | 6 Months Ended |
Apr. 01, 2017 | |
Inventory Disclosure [Abstract] | |
INVENTORIES | INVENTORIES Inventories consisted of the following for each of the periods presented: APRIL 1, APRIL 2, SEPTEMBER 30, (In millions) Finished goods $ 439.0 $ 419.2 $ 248.7 Work-in-process 58.2 50.4 56.9 Raw materials 161.3 150.0 142.6 Total inventories $ 658.5 $ 619.6 $ 448.2 Adjustments to reflect inventories at net realizable values were $11.3 million at April 1, 2017 , $21.2 million at April 2, 2016 and $10.8 million at September 30, 2016 . |
MARKETING AGREEMENT
MARKETING AGREEMENT | 6 Months Ended |
Apr. 01, 2017 | |
Marketing Agreement [Abstract] | |
MARKETING AGREEMENT | MARKETING AGREEMENT The Scotts Company LLC (“Scotts LLC”) and the Monsanto Company (“Monsanto”) are parties to the Amended and Restated Exclusive Agency and Marketing Agreement (the “Marketing Agreement”), pursuant to which the Company has served since its 1998 fiscal year, as Monsanto’s exclusive agent for the marketing and distribution of consumer Roundup ® herbicide products (with additional rights to new products containing glyphosate or other similar non-selective herbicides) in the consumer lawn and garden market. Under the terms of the Marketing Agreement, the Company is entitled to receive an annual commission from Monsanto as consideration for the performance of the Company’s duties as agent. The annual gross commission under the Marketing Agreement is calculated as a percentage of the actual earnings before interest and income taxes of the consumer Roundup ® business in the markets covered by the Marketing Agreement subject to the achievement of annual earnings thresholds. The Marketing Agreement also requires the Company to make annual payments of $20.0 million to Monsanto as a contribution against the overall expenses of the consumer Roundup ® business. From 1998 until May 15, 2015, the Marketing Agreement covered the United States and other specified countries, including Australia, Austria, Belgium, Canada, France, Germany, the Netherlands and the United Kingdom. On May 15, 2015, the territories were expanded to cover additional countries as outlined below. In consideration for the rights granted to the Company under the Marketing Agreement in 1998, the Company paid a marketing fee of $32 million to Monsanto. The Company deferred this amount on the basis that the payment will provide a future benefit through commissions that will be earned under the Marketing Agreement. The economic useful life over which the marketing fee is being amortized is twenty years, with a remaining unamortized amount of $1.2 million and remaining amortization period of less than two years as of April 1, 2017 . On May 15, 2015, the Company and Monsanto entered into an Amendment to the Marketing Agreement (the “Marketing Agreement Amendment”), a Lawn and Garden Brand Extension Agreement (the “Brand Extension Agreement”) and a Commercialization and Technology Agreement (the “Commercialization and Technology Agreement”). In consideration for these agreements, the Company paid $300.0 million to Monsanto on August 14, 2015 using borrowings under its credit facility. Among other things, the Marketing Agreement Amendment amends the Marketing Agreement in the following significant respects: • Expands the territories in which the Company may serve as Monsanto’s exclusive agent in the consumer lawn and garden market to include all countries other than Japan and countries subject to a comprehensive U.S. trade embargo or certain other embargoes and trade restrictions. • Eliminates the initial and renewal terms that the original Marketing Agreement applied to European Union (“EU”) countries. As amended, the term of the Marketing Agreement will now continue indefinitely for all included markets, including EU countries within the included markets, unless and until otherwise terminated in accordance with the Marketing Agreement. • Revises the procedures of the Marketing Agreement relating to a potential sale of the consumer Roundup ® business to (1) require Monsanto to negotiate exclusively with the Company with respect to any potential Roundup ® sale for 60 days after the Company receives notice from Monsanto regarding a potential Roundup ® sale and (2) provide the Company with a right of first offer and a right of last look in connection with a potential Roundup ® sale to a third party. In addition, if the Company makes a bid in connection with a Roundup ® sale, the then-applicable termination fee would serve as a credit against the purchase price and the Monsanto board of directors would not be permitted to discount the value of the Company’s bid compared to a competing bid as a result of the termination fee discount. • Requires the Company to (1) provide notice to Monsanto of certain proposals and processes that may result in a sale of the Company and (2) conduct non-exclusive negotiations with Monsanto with respect to such a sale. • Increases the minimum termination fee payable under the Marketing Agreement to the greater of (1) $200.0 million or (2) four times (A) the average of the program earnings before interest or income taxes for the three trailing program years prior to the year of termination, minus (B) the 2015 program earnings before interest or income taxes. • Amends Monsanto’s termination rights and provides additional rights to the Company in the event of a termination, as follows: ◦ delays the effectiveness of a notice of termination given by Monsanto as a result of a change of control with respect to Monsanto or a sale of the consumer Roundup ® business to a third party from (1) the end of the later of 12 months or the next program year to (2) the end of the fifth full program year after Monsanto gives such notice; ◦ eliminates Monsanto’s termination rights for a regional performance default, a change of significant ownership of the Company or an uncured or incurable egregious injury (as each is defined in the Marketing Agreement); and ◦ eliminates Monsanto’s termination rights in connection with a change in control of the Company or Scotts Miracle-Gro as long as the Company has determined, in its reasonable commercial opinion, that the acquirer can and will fully perform the duties and obligations of the Company under the Marketing Agreement. • Expands the Company’s termination rights to include termination for a brand decline event (as defined in the Marketing Agreement Amendment) occurring before program year 2023. • Expands the Company’s assignment rights to allow the Company to transfer its rights, interests and obligations under the Marketing Agreement with respect to (1) the North America territories and (2) one or more other included markets for up to three other assignments. • Amends the commission structure by (1) eliminating the commission threshold for program years 2016, 2017 and 2018, (2) setting the commission threshold for the subsequent program years at $40 million and (3) establishing the commission payable by Monsanto to the Company for each program year at an amount equal to 50% of the program earnings before interest and income taxes for such program year. The Brand Extension Agreement provides the Company a worldwide, exclusive license to use the Roundup ® brand on additional products offered by the Company outside of the non-selective weed category within the residential lawn and garden market. The application of the Roundup ® brand to these additional products is subject to a product review and approval process developed between the Company and Monsanto. Monsanto will maintain oversight of its brand, the handling of brand registrations covering these new products and new territories, as well as primary responsibility for brand enforcement. The Brand Extension Agreement has an initial term of twenty years, which will automatically renew for additional successive twenty year terms, at the Company’s sole option, for no additional monetary consideration. The Commercialization and Technology Agreement provides for the Company and Monsanto to further develop and commercialize new products and technology developed at Monsanto and intended for introduction into the residential lawn and garden market. Under the Commercialization and Technology Agreement, the Company receives an exclusive first look at new Monsanto technology and products and an annual review of Monsanto’s developing products and technologies. The Commercialization and Technology Agreement has a term of thirty years (subject to early termination upon a termination event under the Marketing Agreement or the Brand Extension Agreement). The Company recorded the $300.0 million consideration paid by the Company to Monsanto in connection with the entry into the Marketing Agreement Amendment, the Brand Extension Agreement and the Commercialization and Technology Agreement as intangible assets and the related economic useful life of such assets is indefinite. The identifiable intangible assets include the Marketing Agreement Amendment and the Brand Extension Agreement with allocated fair value of $188.3 million and $111.7 million , respectively. The estimated fair values of the identifiable intangible assets were determined using an income-based approach, which includes market participant expectations of cash flows that an asset will generate over the remaining useful life discounted to present value using an appropriate rate of return. Under the terms of the Marketing Agreement, the Company performs certain functions, primarily manufacturing conversion services (in North America), distribution and logistics, and selling and marketing support, on behalf of Monsanto in the conduct of the consumer Roundup ® business. The actual costs incurred for these activities are charged to and reimbursed by Monsanto. The Company records costs incurred under the Marketing Agreement for which the Company is the primary obligor on a gross basis, recognizing such costs in the “Cost of sales” line and the reimbursement of these costs in the “Net sales” line in the Condensed Consolidated Statements of Operations, with no effect on gross profit dollars or net income. The gross commission earned under the Marketing Agreement, the contribution payments to Monsanto and the amortization of the initial marketing fee paid to Monsanto in 1998 are included in the calculation of net sales in the Company’s Condensed Consolidated Statements of Operations. The elements of the net commission and reimbursements earned under the Marketing Agreement and included in “Net sales” are as follows: THREE MONTHS ENDED SIX MONTHS ENDED APRIL 1, APRIL 2, APRIL 1, APRIL 2, (In millions) Gross commission $ 46.8 $ 54.9 $ 48.2 $ 54.9 Contribution expenses (5.0 ) (5.0 ) (10.0 ) (10.0 ) Amortization of marketing fee (0.2 ) (0.2 ) (0.4 ) (0.4 ) Net commission 41.6 49.7 37.8 44.5 Reimbursements associated with Marketing Agreement 21.7 22.8 38.3 36.8 Total net sales associated with Marketing Agreement $ 63.3 $ 72.5 $ 76.1 $ 81.3 |
DEBT
DEBT | 6 Months Ended |
Apr. 01, 2017 | |
Debt Disclosure [Abstract] | |
DEBT | DEBT The components of long-term debt are as follows: APRIL 1, APRIL 2, SEPTEMBER 30, (In millions) Credit Facilities: Revolving loans $ 1,109.0 $ 1,075.0 $ 417.4 Term loans 281.3 296.3 288.8 Senior Notes – 5.250% 250.0 — — Senior Notes – 6.000% 400.0 400.0 400.0 Master Accounts Receivable Purchase Agreement — 166.7 138.6 Other 56.1 29.7 71.3 Total debt 2,096.4 1,967.7 1,316.1 Less current portions 32.1 202.9 185.0 Less unamortized debt issuance costs 9.2 6.3 6.0 Long-term debt $ 2,055.1 $ 1,758.5 $ 1,125.1 Credit Facilities On December 20, 2013 , the Company entered into the third amended and restated credit agreement, providing the Company and certain of its subsidiaries with a five -year senior secured revolving loan facility in the aggregate principal amount of up to $1.7 billion (the “former credit facility”). On October 29, 2015, the Company entered into the fourth amended and restated credit agreement (the “credit agreement”), providing the Company and certain of its subsidiaries with five -year senior secured loan facilities in the aggregate principal amount of $1.9 billion , comprised of a revolving credit facility of $1.6 billion and a term loan in the original principal amount of $300.0 million (the “credit facilities”). The credit agreement also provides the Company with the right to seek additional committed credit under the agreement in an aggregate amount of up to $500.0 million plus an unlimited additional amount, subject to certain specified financial and other conditions. Under the credit agreement, the Company has the ability to obtain letters of credit up to $100.0 million . The credit agreement replaces the former credit facility, and will terminate on October 29, 2020 . Borrowings on the revolving credit facility may be made in various currencies, including U.S. dollars, euro, British pounds, Australian dollars and Canadian dollars. The terms of the credit agreement include customary representations and warranties, affirmative and negative covenants, financial covenants and events of default. The proceeds of borrowings on the credit facilities may be used: (i) to finance working capital requirements and other general corporate purposes of the Company and its subsidiaries; and (ii) to refinance the amounts outstanding under the former credit facility. Under the terms of the credit agreement, loans bear interest, at the Company’s election, at a rate per annum equal to either the ABR or Adjusted LIBO Rate (both as defined in the credit agreement) plus the applicable margin. The credit facilities are guaranteed by substantially all of the Company’s domestic subsidiaries, and are secured by (i) a perfected first priority security interest in all of the accounts receivable, inventory and equipment of the Company and the Company’s domestic subsidiaries that are guarantors and (ii) the pledge of all of the capital stock of the Company’s domestic subsidiaries that are guarantors. At April 1, 2017 , the Company had letters of credit outstanding in the aggregate principal amount of $23.8 million , and $0.5 billion of availability under the credit agreement, subject to the Company’s continued compliance with the covenants discussed below. The weighted average interest rate on average borrowings under the credit agreement and the former credit facility was 3.7% for the six months ended April 1, 2017 and April 2, 2016 . The credit agreement contains, among other obligations, an affirmative covenant regarding the Company’s leverage ratio on the last day of each quarter calculated as average total indebtedness, divided by the Company’s earnings before interest, taxes, depreciation and amortization (“EBITDA”), as adjusted pursuant to the terms of the credit agreement (“Adjusted EBITDA”). The maximum leverage ratio was 4.50 as of April 1, 2017 . The Company’s leverage ratio was 3.20 at April 1, 2017 . The credit agreement also includes an affirmative covenant regarding its interest coverage ratio. The interest coverage ratio is calculated as Adjusted EBITDA divided by interest expense, as described in the credit agreement, and excludes costs related to refinancings. The minimum interest coverage ratio was 3.00 for the twelve months ended April 1, 2017 . The Company’s interest coverage ratio was 7.81 for the twelve months ended April 1, 2017 . The credit agreement allows the Company to make unlimited restricted payments (as defined in the credit agreement), including increased or one-time dividend payments and Common Share repurchases, as long as the leverage ratio resulting from the making of such restricted payments is 4.00 or less. Otherwise the Company may only make restricted payments in an aggregate amount for each fiscal year not to exceed the amount set forth in the credit agreement for such fiscal year ( $175.0 million for fiscal 2017 and $200.0 million for fiscal 2018 and each fiscal year thereafter). Senior Notes - 5.250% On December 15, 2016, Scotts Miracle-Gro issued $250.0 million aggregate principal amount of 5.250% senior notes due 2026 (the “ 5.250% Senior Notes”). The net proceeds of the offering were used to repay outstanding borrowings under the credit facilities. The 5.250% Senior Notes represent general unsecured senior obligations and rank equal in right of payment with the Company’s existing and future unsecured senior debt. The 5.250% Senior Notes have interest payment dates of June 15 and December 15 of each year, commencing June 15, 2017 . The 5.250% Senior Notes may be redeemed, in whole or in part, on or after December 15, 2021 at applicable redemption premiums. The 5.250% Senior Notes contain customary covenants and events of default and mature on December 15, 2026 . Substantially all of Scotts Miracle-Gro’s domestic subsidiaries serve as guarantors of the 5.250% Senior Notes. Senior Notes - 6.625% On December 15, 2015 , Scotts Miracle-Gro redeemed all $200.0 million aggregate principal amount of its outstanding 6.625% senior notes due 2020 (the “ 6.625% Senior Notes”) paying a redemption price of $213.2 million , comprised of $6.6 million of accrued and unpaid interest, $6.6 million of call premium and $200.0 million for outstanding principal amount. The $6.6 million call premium charge was recognized within the “Costs related to refinancing” line on the Condensed Consolidated Statement of Operations in the first quarter of fiscal 2016. Additionally, the Company had $2.2 million in unamortized bond discount and issuance costs associated with the 6.625% Senior Notes that were written off and recognized in the “Costs related to refinancing” line on the Condensed Consolidated Statement of Operations in the first quarter of fiscal 2016. Senior Notes - 6.000% On October 13, 2015 , Scotts Miracle-Gro issued $400.0 million aggregate principal amount of 6.000% senior notes due 2023 (the “ 6.000% Senior Notes”). The net proceeds of the offering were used to repay outstanding borrowings under the former credit facility. The 6.000% Senior Notes represent general unsecured senior obligations and rank equal in right of payment with the Company’s existing and future unsecured senior debt. The 6.000% Senior Notes have interest payment dates of April 15 and October 15 of each year. The 6.000% Senior Notes may be redeemed, in whole or in part, on or after October 15, 2018 at applicable redemption premiums. The 6.000% Senior Notes contain customary covenants and events of default and mature on October 15, 2023 . Substantially all of Scotts Miracle-Gro’s domestic subsidiaries serve as guarantors of the 6.000% Senior Notes. Receivables Facility On September 25, 2015, the Company entered into an amended and restated master accounts receivable purchase agreement (the “MARP Agreement”). The MARP Agreement provided for the discretionary sale by the Company, and the discretionary purchase by the participating banks, on a revolving basis, of accounts receivable generated by sales to three specified debtors in an aggregate amount not to exceed $400.0 million . The MARP Agreement terminated effective October 14, 2016 in accordance with its terms upon the Company’s repayment of its outstanding obligations thereunder using $133.5 million borrowed under the credit agreement. There were $166.7 million in borrowings or receivables pledged as collateral under the MARP Agreement as of April 2, 2016 . The carrying value of the receivables pledged as collateral was $208.4 million as of April 2, 2016 . On April 7, 2017, the Company entered into a Master Repurchase Agreement (including the annexes thereto, the “Repurchase Agreement”) and a Master Framework Agreement (the “Framework Agreement” and, together with the Repurchase Agreement, the “Receivables Facility”). Under the Receivables Facility, the Company may sell a portfolio of available and eligible outstanding customer accounts receivable to the purchasers and simultaneously agrees to repurchase the receivables on a weekly basis. The eligible accounts receivable consist of up to $250.0 million in accounts receivable generated by sales to three specified customers. The Receivables Facility is committed up to $100.0 million during the commitment period beginning on April 7, 2017 and ending on June 16, 2017. The Receivables Facility is considered a secured financing with the customer accounts receivable, related contract rights and proceeds thereof (and the collection accounts into which the same are deposited) constituting the collateral therefor. The repurchase price for customer accounts receivable bears interest at LIBOR (with a zero floor) plus 0.90% . The Receivables Facility expires on August 25, 2017. Other In connection with the acquisition of a controlling interest in Gavita, the Company recorded a loan to the noncontrolling ownership group of Gavita. The fair value of the loan was $37.2 million and $38.3 million at April 1, 2017 and September 30, 2016 , respectively. Interest Rate Swap Agreements The Company has outstanding interest rate swap agreements with major financial institutions that effectively convert a portion of the Company’s variable-rate debt to a fixed rate. The swap agreements had a total U.S. dollar equivalent notional amount of $1,150.0 million at April 1, 2017 , $1,250.0 million at April 2, 2016 and $650.0 million at September 30, 2016 . Interest payments made between the effective date and expiration date are hedged by the swap agreements, except as noted below, respectively. The notional amount, effective date, expiration date and rate of each of these swap agreements outstanding at April 1, 2017 are shown in the table below: Notional Amount (in millions) Effective Date (a) Expiration Date Fixed Rate $ 50 (d) 12/6/2012 9/6/2017 2.96 % 200 2/7/2014 11/7/2017 1.28 % 300 (e) 11/21/2016 6/20/2018 0.83 % 200 (e) 11/7/2016 8/7/2018 0.84 % 150 (b) 2/7/2017 5/7/2019 2.12 % 50 (b) 2/7/2017 5/7/2019 2.25 % 200 (c) 12/20/2016 6/20/2019 2.12 % (a) The effective date refers to the date on which interest payments were first hedged by the applicable swap agreement. (b) Interest payments made during the three-month period of each year that begins with the month and day of the effective date are hedged by the swap agreement. (c) Interest payments made during the six-month period of each year that begins with the month and day of the effective date are hedged by the swap agreement. (d) Interest payments made during the nine-month period of each year that begins with the month and day of the effective date are hedged by the swap agreement. (e) Notional amount adjusts in accordance with a specified seasonal schedule. This represents the maximum notional amount at any point in time. Estimated Fair Values The methods and assumptions used to estimate the fair values of the Company’s debt instruments are described below: Credit Facilities The interest rate currently available to the Company fluctuates with the applicable LIBO rate, prime rate or Federal Funds Effective Rate and thus the carrying value is a reasonable estimate of fair value. The fair value measurement for the credit facilities was classified in Level 2 of the fair value hierarchy. 5.250% Senior Notes The fair value of the 5.250% Senior Notes was determined based on the trading of the 5.250% Senior Notes in the open market. The difference between the carrying value and the fair value of the 5.250% Senior Notes represents the premium or discount on that date. Based on the trading value on or around April 1, 2017 , the fair value of the 5.250% Senior Notes was approximately $252.8 million . The fair value measurement for the 5.250% Senior Notes was classified in Level 1 of the fair value hierarchy. 6.000% Senior Notes The fair value of the 6.000% Senior Notes was determined based on the trading of the 6.000% Senior Notes in the open market. The difference between the carrying value and the fair value of the 6.000% Senior Notes represents the premium or discount on that date. Based on the trading value on or around April 1, 2017 , the fair value of the 6.000% Senior Notes was approximately $425.0 million . The fair value measurement for the 6.000% Senior Notes was classified in Level 1 of the fair value hierarchy. Accounts Receivable Pledged The interest rate on the short-term debt associated with accounts receivable pledged under the MARP Agreement fluctuated with the applicable LIBO rate and thus the carrying value is a reasonable estimate of fair value. The fair value measurement for the MARP Agreement was classified in Level 2 of the fair value hierarchy. Weighted Average Interest Rate The weighted average interest rates on the Company’s debt were 4.3% and 4.6% for the six months ended April 1, 2017 and April 2, 2016 , respectively. The decrease in the weighted average interest rate is due to the redemption of the 6.625% Senior Notes. |
RETIREMENT AND RETIREE MEDICAL
RETIREMENT AND RETIREE MEDICAL PLANS | 6 Months Ended |
Apr. 01, 2017 | |
Defined Contribution Pension and Other Postretirement Plans Disclosure [Abstract] | |
RETIREMENT AND RETIREE MEDICAL PLANS | RETIREMENT AND RETIREE MEDICAL PLANS The following summarizes the components of net periodic benefit (income) cost for the retirement and retiree medical plans sponsored by the Company: THREE MONTHS ENDED APRIL 1, 2017 APRIL 2, 2016 U.S. Pension International Pension U.S. Medical U.S. Pension International Pension U.S. Medical (In millions) Service cost $ — $ 0.3 $ 0.1 $ — $ 0.3 $ 0.1 Interest cost 0.7 0.9 0.1 1.1 1.7 0.2 Expected return on plan assets (1.2 ) (2.0 ) — (1.3 ) (2.0 ) — Net amortization 0.4 0.6 (0.2 ) 0.5 0.4 (0.2 ) Net periodic benefit (income) cost $ (0.1 ) $ (0.2 ) $ — $ 0.3 $ 0.4 $ 0.1 SIX MONTHS ENDED APRIL 1, 2017 APRIL 2, 2016 U.S. Pension International Pension U.S. Medical U.S. Pension International Pension U.S. Medical (In millions) Service cost $ — $ 0.6 $ 0.2 $ — $ 0.6 $ 0.2 Interest cost 1.4 1.9 0.3 2.2 3.4 0.5 Expected return on plan assets (2.4 ) (4.0 ) — (2.5 ) (4.0 ) — Net amortization 0.8 1.1 (0.4 ) 0.9 0.8 (0.5 ) Net periodic benefit (income) cost $ (0.2 ) $ (0.4 ) $ 0.1 $ 0.6 $ 0.8 $ 0.2 |
EQUITY
EQUITY | 6 Months Ended |
Apr. 01, 2017 | |
Equity [Abstract] | |
EQUITY | EQUITY In August 2014, the Scotts Miracle-Gro Board of Directors authorized the repurchase of up to $500.0 million of Common Shares over a five -year period (effective November 1, 2014 through September 30, 2019). On August 3, 2016, Scotts Miracle-Gro announced that its Board of Directors authorized a $500.0 million increase to the share repurchase authorization ending on September 30, 2019 . The amended authorization allows for repurchases of Common Shares of $1.0 billion through September 30, 2019 . The authorization provides the Company with flexibility to purchase Common Shares from time to time in open market purchases or through privately negotiated transactions. All or part of the repurchases may be made under Rule 10b5-1 plans, which the Company may enter into from time to time and which enable the repurchases to occur on a more regular basis, or pursuant to accelerated share repurchases. The share repurchase authorization, which expires September 30, 2019, may be suspended or discontinued at any time, and there can be no guarantee as to the timing or amount of any repurchases. During the three and six months ended April 1, 2017 , Scotts Miracle-Gro repurchased 0.5 million and 1.0 million Common Shares for $47.2 million and $90.6 million , respectively. From the inception of this share repurchase program in the fourth quarter of fiscal 2014 through April 1, 2017 , Scotts Miracle-Gro repurchased approximately 3.1 million Common Shares for $236.2 million . The following table provides a summary of the changes in total equity, shareholders’ equity attributable to controlling interest, and equity attributable to noncontrolling interests for the six months ended April 1, 2017 and April 2, 2016 (in millions): Common Shares and Capital in Excess of Stated Value Retained Earnings Treasury Shares Accumulated Other Comprehensive Loss Total Equity - Controlling Interest Non-controlling Interest Total Equity Balance at September 30, 2015 $ 400.4 $ 684.2 $ (357.1 ) $ (106.8 ) $ 620.7 $ 12.4 $ 633.1 Net income (loss) — 129.0 — — 129.0 0.1 129.1 Other comprehensive income — — — 0.2 0.2 — 0.2 Share-based compensation 15.5 — — — 15.5 — 15.5 Dividends declared ($0.940 per share) — (56.8 ) — — (56.8 ) — (56.8 ) Treasury share purchases — — (42.8 ) — (42.8 ) — (42.8 ) Treasury share issuances (14.0 ) — 23.6 — 9.6 — 9.6 Balance at April 2, 2016 $ 401.9 $ 756.4 $ (376.3 ) $ (106.6 ) $ 675.4 $ 12.5 $ 687.9 Balance at September 30, 2016 $ 401.7 $ 881.8 $ (451.4 ) $ (116.9 ) $ 715.2 $ 19.1 $ 734.3 Net income (loss) — 99.8 — — 99.8 0.5 100.3 Other comprehensive income — — — 3.2 3.2 — 3.2 Share-based compensation 19.1 — — — 19.1 — 19.1 Dividends declared ($1.000 per share) — (60.6 ) — — (60.6 ) — (60.6 ) Treasury share purchases — — (90.6 ) — (90.6 ) — (90.6 ) Treasury share issuances (20.0 ) — 13.8 — (6.2 ) — (6.2 ) Adjustment to noncontrolling interest due to ownership change (1.0 ) — — — (1.0 ) 1.0 — Distribution declared by AeroGrow — — — — — (8.1 ) (8.1 ) Balance at April 1, 2017 $ 399.8 $ 921.0 $ (528.2 ) $ (113.7 ) $ 678.9 $ 12.5 $ 691.4 On November 29, 2016, the Company’s wholly-owned subsidiary SMG Growing Media, Inc. fully exercised its outstanding warrants to acquire additional shares of common stock of AeroGrow for an aggregate warrant exercise price of $47.8 million in exchange for the issuance of 21.6 million shares of common stock of AeroGrow, which increased the Company’s percentage ownership of AeroGrow’s outstanding shares of common stock (on a fully diluted basis) from 45% to 80% . The financial results of AeroGrow have been consolidated into the Company’s consolidated financial statements since the fourth quarter of fiscal 2014, when the Company obtained control of AeroGrow’s operations through increased involvement, influence and a working capital loan provided to AeroGrow. Following the exercise of the warrants, the Board of Directors of AeroGrow declared a $41 million distribution ( $1.21 per share) payable on January 3, 2017 to shareholders of record on December 20, 2016. On January 3, 2017, AeroGrow paid a distribution of $8.1 million to its noncontrolling interest holders. Share-Based Awards Scotts Miracle-Gro grants share-based awards annually to officers and certain other employees of the Company and non-employee directors of Scotts Miracle-Gro. The share-based awards have consisted of stock options, restricted stock units, deferred stock units and performance-based awards. All of these share-based awards have been made under plans approved by the shareholders. If available, Scotts Miracle-Gro will typically use treasury shares, or if not available, newly-issued Common Shares, in satisfaction of its share-based awards. On January 30, 2017, the Company issued 0.5 million performance-based award units to certain senior executives as part of its Project Focus initiative. These awards provide for a five-year vesting period based on achievement of specific performance goals aligned with the strategic objectives of the Company’s Project Focus initiatives. The performance goals include a combination of five year cumulative operating cash flow less capital expenditures; five year non-GAAP diluted EPS growth; and dividend yield. The Company assesses the probability of achievement of performance goals each period and records expense for the awards based on the probable achievement of such metrics. Performance-based award units accrue cash dividend equivalents that are payable upon vesting of the awards. The following is a summary of the share-based awards granted during each of the periods indicated: SIX MONTHS ENDED APRIL 1, APRIL 2, Employees Stock options — 444,890 Restricted stock units 102,143 70,594 Performance units 487,674 56,315 Board of Directors Deferred stock units 22,902 26,560 Total share-based awards 612,719 598,359 Aggregate fair value at grant dates (in millions) $ 56.9 $ 16.0 Total share-based compensation was as follows for each of the periods indicated: THREE MONTHS ENDED SIX MONTHS ENDED APRIL 1, APRIL 2, APRIL 1, APRIL 2, (In millions) Share-based compensation $ 12.8 $ 9.1 $ 15.1 $ 11.3 Tax benefit recognized 4.9 3.5 5.8 4.3 As of April 1, 2017 , total unrecognized compensation cost related to non-vested share-based awards amounted to $52.1 million . This cost is expected to be recognized over a weighted-average period of 4.0 years. The tax benefit realized from the tax deductions associated with the exercise of share-based awards and the vesting of restricted stock totaled $4.0 million for the six months ended April 1, 2017 . Stock Options Aggregate stock option activity was as follows: No. of Options Wtd. Avg. Exercise Price Awards outstanding at September 30, 2016 1,801,041 $ 51.38 Exercised (38,757 ) 42.95 Forfeited (9,587 ) 62.86 Awards outstanding at April 1, 2017 1,752,697 51.44 Exercisable 928,489 38.30 The intrinsic value of stock options exercised was $1.9 million during the six months ended April 1, 2017 . At April 1, 2017 , the Company expects 0.8 million of the remaining unexercisable stock options (after forfeitures), with a weighted-average exercise price of $66.13 , intrinsic value of $21.1 million and average remaining term of 8.3 years , to vest in the future. The following summarizes certain information pertaining to stock option awards outstanding and exercisable at April 1, 2017 : Awards Outstanding Awards Exercisable Range of No. of Options Wtd. Avg. Remaining Life Wtd. Avg. Exercise Price No. of Options Wtd. Avg. Remaining Life Wtd. Avg. Exercise Price $20.59 – $20.59 210,386 1.51 $ 20.59 210,386 1.51 $ 20.59 $36.37 – $36.86 157,940 0.60 36.44 157,940 0.60 36.44 $38.81 – $49.19 557,647 3.91 45.39 557,647 3.91 45.39 $63.43 – $68.68 826,724 8.35 66.23 2,516 7.83 63.43 1,752,697 5.42 51.44 928,489 2.81 38.30 The intrinsic values of stock option awards outstanding and exercisable at April 1, 2017 were as follows (in millions): Outstanding $ 73.5 Exercisable 51.2 Restricted share-based awards Restricted share-based award activity (including restricted stock units and deferred stock units) was as follows: No. of Shares Wtd. Avg. Grant Date Fair Value per Share Awards outstanding at September 30, 2016 305,663 $ 66.31 Granted 125,045 92.66 Vested (131,357 ) 60.68 Forfeited (2,010 ) 67.24 Awards outstanding at April 1, 2017 297,341 79.88 Performance-based awards Performance-based award activity was as follows (based on target award amounts): No. of Units Wtd. Avg. Grant Date Fair Value per Unit Awards outstanding at September 30, 2016 266,598 $ 62.52 Granted (a) 487,674 92.95 Vested (147,698 ) 59.82 Forfeited (8,941 ) 62.81 Awards outstanding at April 1, 2017 597,633 88.01 (a) Includes 465,461 units issued to certain senior executives as part of the Company’s Project Focus initiative. |
INCOME TAXES
INCOME TAXES | 6 Months Ended |
Apr. 01, 2017 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES The effective tax rate related to continuing operations for the six months ended April 1, 2017 and April 2, 2016 was 35.5% . The effective tax rate used for interim reporting purposes is based on management’s best estimate of factors impacting the effective tax rate for the full fiscal year. There can be no assurance that the effective tax rate estimated for interim financial reporting purposes will approximate the effective tax rate determined at fiscal year end. Final Treasury Regulations under Internal Revenue Code §987 were enacted on December 7, 2016, governing the methodology to be used in calculating deferred translation gain or loss for certain entities treated as U.S. branches for U.S. tax purposes. The Company has determined that the impact of adopting these regulations is immaterial to the Company's deferred tax balances and financial statements. Scotts Miracle-Gro or one of its subsidiaries files income tax returns in the U.S. federal jurisdiction and various state, local and foreign jurisdictions. Subject to the following exceptions, the Company is no longer subject to examination by these tax authorities for fiscal years prior to 2013. The Company is currently under examination by the Internal Revenue Service and certain foreign and U.S. state and local tax authorities. The U.S. federal examination is limited to fiscal years 2011 and 2012 . With respect to foreign jurisdictions, a German audit is currently ongoing covering fiscal years 2009 through 2012 . In regard to the multiple U.S. state and local audits, the tax periods under examination are limited to fiscal years 2008 through 2015 . In addition to the aforementioned audits, certain other tax deficiency notices and refund claims for previous years remain unresolved. The Company currently anticipates that few of its open and active audits will be resolved within the next twelve months. The Company is unable to make a reasonably reliable estimate as to when or if cash settlements with taxing authorities may occur. Although audit outcomes and the timing of audit payments are subject to significant uncertainty, the Company does not anticipate that the resolution of these tax matters or any events related thereto will result in a material change to its consolidated financial position, results of operations or cash flows. |
CONTINGENCIES
CONTINGENCIES | 6 Months Ended |
Apr. 01, 2017 | |
Commitments and Contingencies Disclosure [Abstract] | |
CONTINGENCIES | CONTINGENCIES Management regularly evaluates the Company’s contingencies, including various lawsuits and claims which arise in the normal course of business, product and general liabilities, workers’ compensation, property losses and other liabilities for which the Company is self-insured or retains a high exposure limit. Self-insurance reserves are established based on actuarial loss estimates for specific individual claims plus actuarially estimated amounts for incurred but not reported claims and adverse development factors applied to existing claims. Legal costs incurred in connection with the resolution of claims, lawsuits and other contingencies generally are expensed as incurred. In the opinion of management, the assessment of contingencies is reasonable and related reserves, in the aggregate, are adequate; however, there can be no assurance that final resolution of these matters will not have a material effect on the Company’s financial condition, results of operations or cash flows. Regulatory Matters At April 1, 2017 , $5.1 million was accrued in the “Other liabilities” line in the Condensed Consolidated Balance Sheets for environmental actions, the majority of which are for site remediation. The amounts accrued are believed to be adequate to cover such known environmental exposures based on current facts and estimates of likely outcomes. Although it is reasonably possible that the costs to resolve such known environmental exposures will exceed the amounts accrued, any variation from accrued amounts is not expected to be material. Other The Company has been named as a defendant in a number of cases alleging injuries that the lawsuits claim resulted from exposure to asbestos-containing products, apparently based on the Company’s historic use of vermiculite in certain of its products. In many of these cases, the complaints are not specific about the plaintiffs’ contacts with the Company or its products. The cases vary, but complaints in these cases generally seek unspecified monetary damages (actual, compensatory, consequential and punitive) from multiple defendants. The Company believes that the claims against it are without merit and is vigorously defending against them. It is not currently possible to reasonably estimate a probable loss, if any, associated with these cases and, accordingly, no reserves have been recorded in the Company’s condensed consolidated financial statements. The Company is reviewing agreements and policies that may provide insurance coverage or indemnity as to these claims and is pursuing coverage under some of these agreements and policies, although there can be no assurance of the results of these efforts. There can be no assurance that these cases, whether as a result of adverse outcomes or as a result of significant defense costs, will not have a material effect on the Company’s financial condition, results of operations or cash flows. In connection with the sale of wild bird food products that were the subject of a voluntary recall in 2008, the Company, along with its Chief Executive Officer, have been named as defendants in four actions filed on and after June 27, 2012, which have been consolidated and, on March 31, 2017, certified as a class action in the United States District Court for the Southern District of California as In re Morning Song Bird Food Litigation , Lead Case No. 3:12-cv-01592-JAH-RBB. The plaintiffs allege various statutory and common law claims associated with the Company’s sale of wild bird food products and a plea agreement entered into in previously pending government proceedings associated with such sales. The plaintiffs allege, among other things, a class action on behalf of all persons and entities in the United States who purchased certain bird food products. The plaintiffs assert: (i) hundreds of millions of dollars in monetary damages (actual, compensatory, consequential, and restitution); (ii) punitive and treble damages; (iii) injunctive and declaratory relief; (iv) pre-judgment and post-judgment interest; and (v) costs and attorneys’ fees. The Company and its Chief Executive Officer dispute the plaintiffs’ assertions and intend to vigorously defend the consolidated action. At this point in the proceedings, it is not currently possible to reasonably estimate a probable loss, if any, associated with the action and, accordingly, no reserves have been recorded in the consolidated financial statements with respect to the action. There can be no assurance that this action, whether as a result of an adverse outcome or as a result of significant defense costs, will not have a material adverse effect on the Company’s financial condition, results of operations or cash flows. The Company is involved in other lawsuits and claims which arise in the normal course of business. These claims individually and in the aggregate are not expected to result in a material effect on the Company’s financial condition, results of operations or cash flows. |
DERIVATIVE INSTRUMENTS AND HEDG
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | 6 Months Ended |
Apr. 01, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES | DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES The Company is exposed to market risks, such as changes in interest rates, currency exchange rates and commodity prices. To manage a portion of the volatility related to these exposures, the Company enters into various financial transactions. The utilization of these financial transactions is governed by policies covering acceptable counterparty exposure, instrument types and other hedging practices. The Company does not hold or issue derivative financial instruments for speculative trading purposes. Exchange Rate Risk Management The Company uses currency forward contracts to manage the exchange rate risk associated with intercompany loans with foreign subsidiaries that are denominated in local currencies. At April 1, 2017 , the notional amount of outstanding currency forward contracts was $288.4 million , with a negative fair value of $3.5 million . At April 2, 2016 , the notional amount of outstanding currency forward contracts was $54.3 million , with a negative fair value of $0.2 million . At September 30, 2016 , the notional amount of outstanding currency forward contracts was $165.8 million , with a fair value of $0.4 million . The fair value of currency forward contracts is determined using forward rates in commonly quoted intervals for the full term of the contracts. The outstanding contracts will mature over the next fiscal year. Interest Rate Risk Management The Company enters into interest rate swap agreements as a means to hedge its variable interest rate risk on debt instruments. Net amounts to be received or paid under the swap agreements are reflected as adjustments to interest expense. Since the interest rate swap agreements have been designated as hedging instruments, unrealized gains or losses resulting from adjusting these swaps to fair value are recorded as elements of accumulated other comprehensive income (loss) (“AOCI”) within the Condensed Consolidated Balance Sheets except for any ineffective portion of the change in fair value, which is immediately recorded in interest expense. The fair value of the swap agreements is determined based on the present value of the estimated future net cash flows using implied rates in the applicable yield curve as of the valuation date. The Company has outstanding interest rate swap agreements with major financial institutions that effectively convert a portion of the Company’s variable-rate debt to a fixed rate. The swap agreements had a total U.S. dollar equivalent notional amount of $1,150.0 million at April 1, 2017 , $1,250.0 million at April 2, 2016 and $650.0 million at September 30, 2016 . Refer to “NOTE 8. DEBT” for the terms of the swap agreements outstanding at April 1, 2017 . Included in the AOCI balance at April 1, 2017 was a loss of $0.5 million related to interest rate swap agreements that is expected to be reclassified to earnings during the next twelve months, consistent with the timing of the underlying hedged transactions. Commodity Price Risk Management The Company enters into hedging arrangements designed to fix the price of a portion of its projected future urea requirements. The contracts are designated as hedges of the Company’s exposure to future cash flow fluctuations associated with the cost of urea. The objective of the hedges is to mitigate the earnings and cash flow volatility attributable to the risk of changing prices. Since the contracts have been designated as hedging instruments, unrealized gains or losses resulting from adjusting these contracts to fair value are recorded as elements of AOCI within the Condensed Consolidated Balance Sheets. Realized gains or losses remain as a component of AOCI until the related inventory is sold. Upon sale of the underlying inventory, the gain or loss is reclassified to cost of sales. Included in the AOCI balance at April 1, 2017 was a loss of $0.1 million related to urea derivatives that is expected to be reclassified to earnings during the next twelve months, consistent with the timing of the underlying hedged transactions. The Company also uses derivatives to partially mitigate the effect of fluctuating diesel costs on operating results. These financial instruments are carried at fair value within the Condensed Consolidated Balance Sheets. Changes in the fair value of derivative contracts that qualify for hedge accounting are recorded in AOCI except for any ineffective portion of the change in fair value, which is immediately recorded in earnings. The effective portion of the change in fair value remains as a component of AOCI until the related fuel is consumed, at which time the accumulated gain or loss on the derivative contract is reclassified to cost of sales. Changes in the fair value of derivatives that do not qualify for hedge accounting are recorded as an element of cost of sales. At April 1, 2017 , there were no amounts included within AOCI. The Company had the following outstanding commodity contracts that were entered into to hedge forecasted purchases: COMMODITY APRIL 1, APRIL 2, SEPTEMBER 30, Urea 28,500 tons 21,000 tons 40,500 tons Diesel 5,544,000 gallons 5,922,000 gallons 6,384,000 gallons Heating Oil 1,680,000 gallons 1,974,000 gallons 1,722,000 gallons Fair Values of Derivative Instruments The fair values of the Company’s derivative instruments were as follows: ASSETS / (LIABILITIES) DERIVATIVES DESIGNATED AS HEDGING INSTRUMENTS APRIL 1, APRIL 2, SEPTEMBER 30, BALANCE SHEET LOCATION FAIR VALUE (In millions) Interest rate swap agreements Prepaid and other current assets $ 0.7 $ — $ — Other assets 0.8 — — Other current liabilities (1.9 ) (5.8 ) (3.3 ) Other liabilities (0.7 ) (5.1 ) (3.1 ) Commodity hedging instruments Other current liabilities (0.2 ) (0.7 ) (0.3 ) Total derivatives designated as hedging instruments $ (1.3 ) $ (11.6 ) $ (6.7 ) DERIVATIVES NOT DESIGNATED AS HEDGING INSTRUMENTS BALANCE SHEET LOCATION Currency forward contracts Prepaid and other current assets $ 0.5 $ — $ 1.2 Other current liabilities (4.0 ) (0.2 ) (0.8 ) Commodity hedging instruments Other current liabilities (0.1 ) (3.8 ) (0.1 ) Total derivatives not designated as hedging instruments (3.6 ) (4.0 ) 0.3 Total derivatives $ (4.9 ) $ (15.6 ) $ (6.4 ) The effect of derivative instruments on AOCI and the Condensed Consolidated Statements of Operations was as follows: DERIVATIVES IN CASH FLOW HEDGING RELATIONSHIPS AMOUNT OF GAIN / (LOSS) RECOGNIZED IN AOCI THREE MONTHS ENDED SIX MONTHS ENDED APRIL 1, APRIL 2, APRIL 1, APRIL 2, (In millions) Interest rate swap agreements $ 0.4 $ (2.6 ) $ 2.5 $ (0.9 ) Commodity hedging instruments (0.4 ) (0.3 ) 0.5 (0.7 ) Total $ — $ (2.9 ) $ 3.0 $ (1.6 ) DERIVATIVES IN CASH FLOW HEDGING RELATIONSHIPS RECLASSIFIED FROM AOCI INTO STATEMENT OF OPERATIONS AMOUNT OF GAIN / (LOSS) THREE MONTHS ENDED SIX MONTHS ENDED APRIL 1, APRIL 2, APRIL 1, APRIL 2, (In millions) Interest rate swap agreements Interest expense $ (0.9 ) $ (2.2 ) $ (1.2 ) $ (3.2 ) Commodity hedging instruments Cost of sales (0.2 ) (0.6 ) (0.3 ) (0.4 ) Total $ (1.1 ) $ (2.8 ) $ (1.5 ) $ (3.6 ) DERIVATIVES NOT DESIGNATED AS HEDGING INSTRUMENTS RECOGNIZED IN STATEMENT OF OPERATIONS AMOUNT OF GAIN / (LOSS) THREE MONTHS ENDED SIX MONTHS ENDED APRIL 1, APRIL 2, APRIL 1, APRIL 2, (In millions) Currency forward contracts Other income, net $ (2.2 ) $ (0.3 ) $ 7.0 $ (1.1 ) Commodity hedging instruments Cost of sales (0.9 ) (1.0 ) — (4.3 ) Total $ (3.1 ) $ (1.3 ) $ 7.0 $ (5.4 ) |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 6 Months Ended |
Apr. 01, 2017 | |
Fair Value Disclosures [Abstract] | |
FAIR VALUE MEASUREMENTS | FAIR VALUE MEASUREMENTS Fair value is defined as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or the most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. A three-level fair value hierarchy prioritizes the inputs used to measure fair value. The hierarchy requires entities to maximize the use of observable inputs and minimize the use of unobservable inputs. The three levels of inputs used to measure fair value are as follows: Level 1 — Quoted prices in active markets for identical assets or liabilities. Level 2 — Observable inputs other than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated by observable market data. Level 3 — Unobservable inputs that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. This includes pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs. The following describes the valuation methodologies used for financial assets and liabilities measured at fair value on a recurring basis, as well as the general classification within the valuation hierarchy. Derivatives Derivatives consist of currency, interest rate and commodity derivative instruments. Currency forward contracts are valued using observable forward rates in commonly quoted intervals for the full term of the contracts. Interest rate swap agreements are valued based on the present value of the estimated future net cash flows using implied rates in the applicable yield curve as of the valuation date. Commodity contracts are measured using observable commodity exchange prices in active markets. These derivative instruments are classified within Level 2 of the valuation hierarchy and are included within other assets and other liabilities in the Company’s Condensed Consolidated Balance Sheets, except for derivative instruments expected to be settled within the next 12 months, which are included within prepaid and other current assets and other current liabilities. Cash Equivalents Cash equivalents consist of highly liquid financial instruments with original maturities of three months or less. The carrying value of these cash equivalents approximates fair value due to their short-term maturities. Other Other consists of investment securities in non-qualified retirement plan assets and the Bonnie Option. Investment securities in non-qualified retirement plan assets are valued using observable market prices in active markets and are classified within Level 1 of the valuation hierarchy. The fair value of the Bonnie Option is determined using a simulation approach, whereby the total value of the loan receivable and optional exchange for additional equity was estimated considering a distribution of possible future cash flows discounted to present value using an appropriate discount rate, and is classified in Level 3 of the fair value hierarchy. Long-Term Debt Long-term debt consists of a loan provided to the noncontrolling ownership group of Gavita. The estimated fair value of the loan was determined using an income-based approach, which includes market participant expectations of cash flows over the remaining useful life discounted to present value using an appropriate discount rate. The estimate requires subjective assumptions to be made, including those related to future business results and discount rates. The fair value measurement is based on significant inputs unobservable in the market and thus represents a Level 3 measurement. The following table presents the Company’s financial assets and liabilities measured at fair value on a recurring basis at April 1, 2017 : Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Unobservable Inputs (Level 3) Total (In millions) Assets Cash equivalents $ 17.7 $ — $ — $ 17.7 Derivatives Interest rate swap agreements — 1.5 — 1.5 Currency forward contracts — 0.5 — 0.5 Other 14.5 — 10.9 25.4 Total $ 32.2 $ 2.0 $ 10.9 $ 45.1 Liabilities Derivatives Interest rate swap agreements $ — $ (2.6 ) $ — $ (2.6 ) Currency forward contracts — (4.0 ) — (4.0 ) Commodity hedging instruments — (0.3 ) — (0.3 ) Long-term debt — — (37.2 ) (37.2 ) Total $ — $ (6.9 ) $ (37.2 ) $ (44.1 ) The following table presents the Company’s financial assets and liabilities measured at fair value on a recurring basis at April 2, 2016 : Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Unobservable Inputs (Level 3) Total (In millions) Assets Cash equivalents $ 22.6 $ — $ — $ 22.6 Other 11.1 — — 11.1 Total $ 33.7 $ — $ — $ 33.7 Liabilities Derivatives Interest rate swap agreements $ — $ (10.9 ) $ — $ (10.9 ) Currency forward contracts — (0.2 ) — (0.2 ) Commodity hedging instruments — (4.5 ) — (4.5 ) Total $ — $ (15.6 ) $ — $ (15.6 ) The following table presents the Company’s financial assets and liabilities measured at fair value on a recurring basis at September 30, 2016 : Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Unobservable Inputs (Level 3) Total (In millions) Assets Cash equivalents $ 11.5 $ — $ — $ 11.5 Derivatives Currency forward contracts — 1.2 — 1.2 Other 11.8 — 10.9 22.7 Total $ 23.3 $ 1.2 $ 10.9 $ 35.4 Liabilities Derivatives Interest rate swap agreements $ — $ (6.4 ) $ — $ (6.4 ) Currency forward contracts — (0.8 ) — (0.8 ) Commodity hedging instruments — (0.4 ) — (0.4 ) Long-term debt — — (38.3 ) (38.3 ) Total $ — $ (7.6 ) $ (38.3 ) $ (45.9 ) |
SEGMENT INFORMATION
SEGMENT INFORMATION | 6 Months Ended |
Apr. 01, 2017 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | SEGMENT INFORMATION The Company divides its business into three reportable segments: U.S. Consumer, Europe Consumer and Other. U.S. Consumer consists of the Company’s consumer lawn and garden business located in the geographic United States. Europe Consumer consists of the Company’s consumer lawn and garden business located in geographic Europe. Other consists of the Company’s consumer lawn and garden businesses in geographies other than the U.S. and Europe, the Company’s indoor, urban and hydroponic gardening business, and revenues and expenses associated with the Company’s supply agreements with Israel Chemicals, Ltd. Corporate consists of general and administrative expenses and certain other income/expense items not allocated to the business segments. This division of reportable segments is consistent with how the segments report to and are managed by the chief operating decision maker of the Company. Segment performance is evaluated based on several factors, including income (loss) from continuing operations before income taxes, amortization, impairment, restructuring and other charges (“Segment Profit (Loss)”). Senior management uses this measure of profit (loss) to evaluate segment performance because the Company believes this measure is indicative of performance trends and the overall earnings potential of each segment. The following tables present summarized financial information concerning the Company’s reportable segments for the periods indicated: THREE MONTHS ENDED SIX MONTHS ENDED APRIL 1, APRIL 2, APRIL 1, APRIL 2, (In millions) Net sales: U.S. Consumer $ 962.5 $ 1,039.7 $ 1,088.0 $ 1,152.9 Europe Consumer 105.3 115.0 129.7 140.7 Other 135.7 90.5 232.6 146.1 Consolidated $ 1,203.5 $ 1,245.2 $ 1,450.3 $ 1,439.7 Segment Profit (Loss): U.S. Consumer $ 313.8 $ 336.0 $ 275.8 $ 281.8 Europe Consumer 18.3 21.6 9.9 12.4 Other 15.1 4.6 20.7 5.1 Total Segment Profit 347.2 362.2 306.4 299.3 Corporate (35.9 ) (35.7 ) (58.8 ) (60.1 ) Intangible asset amortization (6.1 ) (4.3 ) (11.9 ) (8.2 ) Impairment, restructuring and other (3.3 ) 47.0 (4.7 ) 40.5 Equity in loss of unconsolidated affiliates (a) (24.1 ) — (37.3 ) — Costs related to refinancing — — — (8.8 ) Interest expense (21.5 ) (19.1 ) (37.1 ) (35.4 ) Income from continuing operations before income taxes $ 256.3 $ 350.1 $ 156.6 $ 227.3 (a) Included within loss of unconsolidated affiliates for the three and six months ended April 1, 2017 are charges of $2.1 million and $11.7 million , respectively, which represent the Company’s share of restructuring and other charges incurred by the TruGreen Joint Venture. APRIL 1, APRIL 2, SEPTEMBER 30, (In millions) Total assets: U.S. Consumer $ 2,601.3 $ 2,636.0 $ 1,770.7 Europe Consumer 275.1 322.6 192.1 Other 726.4 367.8 568.1 Corporate 235.6 144.2 271.9 Assets held for sale — 208.7 — Consolidated $ 3,838.4 $ 3,679.3 $ 2,802.8 |
SUBSEQUENT EVENT
SUBSEQUENT EVENT | 6 Months Ended |
Apr. 01, 2017 | |
Subsequent Events [Abstract] | |
Subsequent Event | SUBSEQUENT EVENT On April 29, 2017 , the Company received a binding and irrevocable conditional offer (the “Offer”) from Exponent Private Equity LLP (“Exponent”) to purchase its consumer lawn and garden business carried on in certain international jurisdictions (the “International Business”). The Offer remains valid until the earlier of (i) October 6, 2017, and (ii) the fifth business day after the date of completion of the compulsory process in respect of France SAS of notice, information and consultation with the French Works Council ( Comité Central d’Entreprise at Scotts France SAS ). If accepted by the Company, pursuant to the terms of the Share and Business Sale Agreement (the “Agreement”) contemplated by the Offer, Scotts-Sierra Investments LLC, an indirect wholly-owned subsidiary of the Company (“Sierra”) and certain of its direct and indirect subsidiaries, will enter into separate stock or asset sale transactions with respect to the consumer lawn and garden businesses located in Australia, Austria, Benelux, Czech Republic, France, Germany, Poland and the United Kingdom. Upon closing of the transaction, Exponent would pay the Company approximately EUR 210.0 million (subject to potential adjustment following closing in respect of the actual financial position at closing) and a deferred payment amount of up to EUR 20.0 million , contingent on the achievement of certain performance criteria by the International Business following the closing of the transaction. Following completion of the French Works Council consultation, if Sierra does not accept the binding offer, Sierra will be required to pay a break fee of EUR 10.0 million in cash. Upon acceptance of the Offer by the Company, the parties’ obligations to consummate the transaction would be conditioned upon (i) the Monsanto Company entering into a certain exclusive agency and marketing agreement and a certain lawn and garden brand extension agreement, each with Exponent, relating to the marketing and distribution of Roundup ® products, (ii) the receipt of landlord consents to the transfer of/change of control in respect of certain material real estate leases, (iii) evidence of the waiver by the relevant municipal authority of its pre-emption right in relation to the properties of the International Business in Bourth and Hautmont in France, or the expiry of the period during which the relevant municipal authority may exercise such right of pre-emption, (iv) specific third party written consent in respect of the assignment of certain supply agreements and the sub-licensing of certain intellectual property, and (v) the receipt of formal clearance from the competition authorities in France, Germany and Poland. As part of the transaction, Exponent received vendor financing from Sierra in the form of a EUR 25.0 million loan for seven years bearing interest at 5% for the first three years, with annual 250 basis point increases thereafter. The Agreement also includes customary representations, warranties and covenants. Among other things, Sierra will provide customary business warranties regarding the International Business subject to certain financial limitations. Also, Sierra has agreed to certain customary pre-closing covenants, including with respect to the operation of the International Business prior to closing and the assistance with and delivery of certain regulatory approvals and third party consents. |
FINANCIAL INFORMATION FOR SUBSI
FINANCIAL INFORMATION FOR SUBSIDIARY GUARANTORS AND NON-GUARANTORS | 6 Months Ended |
Apr. 01, 2017 | |
Condensed Financial Information of Parent Subsidiary Guarantors and Subsidiary Non Guarantors [Abstract] | |
FINANCIAL INFORMATION FOR SUBSIDIARY GUARANTORS AND NON-GUARANTORS | FINANCIAL INFORMATION FOR SUBSIDIARY GUARANTORS AND NON-GUARANTORS The 6.000% and 5.250% Senior Notes were issued on October 13, 2015 and December 15, 2016, respectively, and are guaranteed by certain of the Company’s domestic subsidiaries and, therefore, the Company reports condensed consolidating financial information in accordance with SEC Regulation S-X Rule 3-10, Financial Statements of Guarantors and Issuers of Guaranteed Securities Registered or Being Registered. On December 15, 2015, Scotts Miracle-Gro redeemed all of its outstanding $200.0 million aggregate principal amount of 6.625% Senior Notes, which were previously guaranteed by certain of its domestic subsidiaries. The guarantees are “full and unconditional,” as those terms are used in Regulation S-X Rule 3-10, except that a subsidiary’s guarantee will be released in certain customary circumstances, such as (1) upon any sale or other disposition of all or substantially all of the assets of the subsidiary (including by way of merger or consolidation) to any person other than Scotts Miracle-Gro or any “restricted subsidiary” under the indentures governing the 6.000% and 5.250% Senior Notes; (2) if the subsidiary merges with and into Scotts Miracle-Gro, with Scotts Miracle-Gro surviving such merger; (3) if the subsidiary is designated an “unrestricted subsidiary” in accordance with the indentures governing the 6.000% and 5.250% Senior Notes or otherwise ceases to be a “restricted subsidiary” (including by way of liquidation or dissolution) in a transaction permitted by such indenture; (4) upon legal or covenant defeasance; (5) at the election of Scotts Miracle-Gro following the subsidiary’s release as a guarantor under the new credit agreement, except a release by or as a result of the repayment of the new credit agreement; or (6) if the subsidiary ceases to be a “restricted subsidiary” and the subsidiary is not otherwise required to provide a guarantee of the 6.000% and 5.250% Senior Notes pursuant to the indentures governing the 6.000% and 5.250% Senior Notes. SLS Holdings, Inc. was added as a guarantor effective in the three-month period ending July 2, 2016, and HGCI, Inc. and GenSource, Inc. were added as guarantors effective in the three-month period ending January 2, 2016, and have been classified as Guarantors for all periods presented. The following 100% directly or indirectly owned subsidiaries fully and unconditionally guarantee at April 1, 2017 the 6.000% and 5.250% Senior Notes on a joint and several basis: Gutwein & Co., Inc.; Hyponex Corporation; Miracle-Gro Lawn Products, Inc.; OMS Investments, Inc.; Rod McLellan Company; Sanford Scientific, Inc.; Scotts Temecula Operations, LLC; Scotts Manufacturing Company; Scotts Products Co.; Scotts Professional Products Co.; Scotts-Sierra Investments LLC; SMG Growing Media, Inc.; Swiss Farms Products, Inc.; SMGM LLC; The Scotts Company LLC; The Hawthorne Gardening Company; Hawthorne Hydroponics LLC; HGCI, Inc.; GenSource, Inc.; and SLS Holdings, Inc. (collectively, the “Guarantors”). Effective in the three-month period ending July 2, 2016, the SLS Business was contributed to the TruGreen Joint Venture and the Company classified its results of operations for all periods presented to reflect the SLS Business as a discontinued operation and classified the assets and liabilities as held for sale within the financial information of the Guarantors. Subsequent to their contribution to the TruGreen Joint Venture, EG Systems, LLC (formerly known as EG Systems, Inc.) and SLS Franchise Systems LLC are no longer guarantors of the 6.000% Senior Notes. The following information presents Condensed Consolidating Statements of Operations for the three and six months ended April 1, 2017 and April 2, 2016 , Condensed Consolidating Statements of Comprehensive Income (Loss) for the three and six months ended April 1, 2017 and April 2, 2016 , Condensed Consolidating Statements of Cash Flows for the six months ended April 1, 2017 and April 2, 2016 , and Condensed Consolidating Balance Sheets as of April 1, 2017 , April 2, 2016 and September 30, 2016 . The condensed consolidating financial information presents, in separate columns, financial information for: Scotts Miracle-Gro on a Parent-only basis, carrying its investment in subsidiaries under the equity method; Guarantors on a combined basis, carrying their investments in subsidiaries which do not guarantee the debt (collectively, the “Non-Guarantors”) under the equity method; Non-Guarantors on a combined basis; and eliminating entries. The eliminating entries primarily reflect intercompany transactions, such as interest expense, accounts receivable and payable, short and long-term debt, and the elimination of equity investments, return on investments and income in subsidiaries. Because the Parent is obligated to pay the unpaid principal amount and interest on all amounts borrowed by the Guarantors or Non-Guarantors under the credit facility (and was obligated to pay the unpaid principal amount and interest on all amounts borrowed by the Guarantors and Non-Guarantors under the previous senior secured five -year revolving loan facility), the borrowings and related interest expense for the loans outstanding of the Guarantors and Non-Guarantors are also presented in the accompanying Parent-only financial information, and are then eliminated. Included in the Parent Condensed Consolidating Statement of Cash Flows for the six months ended April 1, 2017 are $351.5 million of dividends paid by the Guarantors and Non-Guarantors to the Parent representing return of investments and as such are classified within cash flows used in investing activities. Included in the Parent Condensed Consolidating Statement of Cash Flows for the six months ended April 2, 2016 are $313.8 million of dividends paid by the Guarantors and Non-Guarantors to the Parent representing return on investments and as such are classified within cash flows from operating activities. THE SCOTTS MIRACLE-GRO COMPANY Condensed Consolidating Statement of Operations for the three months ended April 1, 2017 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated Net sales $ — $ 998.8 $ 204.7 $ — $ 1,203.5 Cost of sales — 558.4 142.7 — 701.1 Gross profit — 440.4 62.0 — 502.4 Operating expenses: Selling, general and administrative — 156.0 41.4 0.4 197.8 Impairment, restructuring and other — 3.7 (0.4 ) — 3.3 Other (income) loss, net (0.2 ) (1.1 ) 0.7 — (0.6 ) Income (loss) from operations 0.2 281.8 20.3 (0.4 ) 301.9 Equity (income) loss in subsidiaries (173.8 ) (8.3 ) — 182.1 — Other non-operating (income) loss (7.5 ) — (4.0 ) 11.5 — Equity in (income) loss of unconsolidated affiliates — 24.0 0.1 — 24.1 Interest expense 20.5 11.4 1.1 (11.5 ) 21.5 Income (loss) from continuing operations before income taxes 161.0 254.7 23.1 (182.5 ) 256.3 Income tax (benefit) expense from continuing operations (4.6 ) 87.4 8.2 — 91.0 Income (loss) from continuing operations 165.6 167.3 14.9 (182.5 ) 165.3 Income (loss) from discontinued operations, net of tax — (0.1 ) — — (0.1 ) Net income (loss) $ 165.6 $ 167.2 $ 14.9 $ (182.5 ) $ 165.2 Net (income) loss attributable to noncontrolling interest — — — (0.1 ) (0.1 ) Net income (loss) attributable to controlling interest $ 165.6 $ 167.2 $ 14.9 $ (182.6 ) $ 165.1 THE SCOTTS MIRACLE-GRO COMPANY Condensed Consolidating Statement of Operations for the six months ended April 1, 2017 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated Net sales $ — $ 1,144.3 $ 306.0 $ — $ 1,450.3 Cost of sales — 684.8 218.9 — 903.7 Gross profit — 459.5 87.1 — 546.6 Operating expenses: Selling, general and administrative — 241.8 74.4 0.7 316.9 Impairment, restructuring and other — 5.1 (0.4 ) — 4.7 Other (income) loss, net (0.4 ) (6.4 ) 0.8 — (6.0 ) Income (loss) from operations 0.4 219.0 12.3 (0.7 ) 231.0 Equity (income) loss in subsidiaries (115.4 ) (7.0 ) — 122.4 — Other non-operating (income) loss (11.8 ) — (9.9 ) 21.7 — Equity in (income) loss of unconsolidated affiliates — 37.2 0.1 — 37.3 Interest expense 35.3 21.3 2.2 (21.7 ) 37.1 Income (loss) from continuing operations before income taxes 92.3 167.5 19.9 (123.1 ) 156.6 Income tax (benefit) expense from continuing operations (8.2 ) 56.8 7.0 — 55.6 Income (loss) from continuing operations 100.5 110.7 12.9 (123.1 ) 101.0 Income (loss) from discontinued operations, net of tax — (0.7 ) — — (0.7 ) Net income (loss) $ 100.5 $ 110.0 $ 12.9 $ (123.1 ) $ 100.3 Net (income) loss attributable to noncontrolling interest — — — (0.5 ) (0.5 ) Net income (loss) attributable to controlling interest $ 100.5 $ 110.0 $ 12.9 $ (123.6 ) $ 99.8 THE SCOTTS MIRACLE-GRO COMPANY Condensed Consolidating Statement of Comprehensive Income (Loss) for the three months ended April 1, 2017 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated Net income (loss) $ 165.6 $ 167.2 $ 14.9 $ (182.5 ) $ 165.2 Other comprehensive income (loss), net of tax: Net foreign currency translation adjustment 1.8 — 1.8 (1.8 ) 1.8 Net change in derivatives 1.1 (0.2 ) — 0.2 1.1 Net change in pension and other post-retirement benefits 0.5 0.3 0.2 (0.5 ) 0.5 Total other comprehensive income (loss) 3.4 0.1 2.0 (2.1 ) 3.4 Comprehensive income (loss) $ 169.0 $ 167.3 $ 16.9 $ (184.6 ) $ 168.6 THE SCOTTS MIRACLE-GRO COMPANY Condensed Consolidating Statement of Comprehensive Income (Loss) for the six months ended April 1, 2017 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated Net income (loss) $ 100.5 $ 110.0 $ 12.9 $ (123.1 ) $ 100.3 Other comprehensive income (loss), net of tax: Net foreign currency translation adjustment (2.2 ) — (2.2 ) 2.2 (2.2 ) Net change in derivatives 4.5 0.8 — (0.8 ) 4.5 Net change in pension and other post-retirement benefits 0.9 0.3 0.6 (0.9 ) 0.9 Total other comprehensive income (loss) 3.2 1.1 (1.6 ) 0.5 3.2 Comprehensive income (loss) $ 103.7 $ 111.1 $ 11.3 $ (122.6 ) $ 103.5 THE SCOTTS MIRACLE-GRO COMPANY Condensed Consolidating Statement of Cash Flows for the six months ended April 1, 2017 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES $ (17.0 ) $ (386.6 ) $ (94.2 ) $ — $ (497.8 ) INVESTING ACTIVITIES (a) Proceeds from sale of long-lived assets — 4.8 — — 4.8 Investments in property, plant and equipment — (27.8 ) (5.0 ) — (32.8 ) Distributions from (investments in) unconsolidated affiliates — — (0.2 ) — (0.2 ) Investments in acquired businesses, net of cash acquired — (1.5 ) (76.4 ) — (77.9 ) Return of investments from affiliates 351.5 32.4 — (383.9 ) — Investing cash flows from (to) affiliates (436.1 ) (276.9 ) — 713.0 — Net cash provided by (used in) investing activities (84.6 ) (269.0 ) (81.6 ) 329.1 (106.1 ) FINANCING ACTIVITIES Borrowings under revolving and bank lines of credit and term loans — 806.2 138.4 — 944.6 Repayments under revolving and bank lines of credit and term loans — (232.3 ) (162.7 ) — (395.0 ) Proceeds from issuance of 5.250% Senior Notes 250.0 — — — 250.0 Financing and issuance fees (3.8 ) (0.1 ) — — (3.9 ) Dividends paid (59.9 ) (351.5 ) — 351.5 (59.9 ) Distribution paid by AeroGrow — — (40.5 ) 32.4 (8.1 ) Purchase of Common Shares (90.4 ) — — — (90.4 ) Payments on seller notes — — (13.2 ) — (13.2 ) Excess tax benefits from share-based payment arrangements 4.0 — — — 4.0 Cash received from the exercise of stock options 1.7 — — — 1.7 Financing cash flows from (to) affiliates — 436.1 276.9 (713.0 ) — Net cash provided by (used in) financing activities 101.6 658.4 198.9 (329.1 ) 629.8 Effect of exchange rate changes on cash — — (1.7 ) — (1.7 ) Net increase (decrease) in cash and cash equivalents — 2.8 21.4 — 24.2 Cash and cash equivalents at beginning of period — 2.7 47.4 — 50.1 Cash and cash equivalents at end of period $ — $ 5.5 $ 68.8 $ — $ 74.3 (a) Cash received by the Parent from the Guarantors and Non-Guarantors in the form of dividends in the amount of $351.5 million represent return of investments and are included in cash flows from investing activities. Cash received by the Guarantors from the Non-Guarantors in the form of distributions in the amount of $32.4 million represent return of investments and are included in cash flows from investing activities. THE SCOTTS MIRACLE-GRO COMPANY Condensed Consolidating Balance Sheet As of April 1, 2017 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated ASSETS Current assets: Cash and cash equivalents $ — $ 5.5 $ 68.8 $ — $ 74.3 Accounts receivable, net — 900.8 220.5 — 1,121.3 Inventories — 500.7 157.8 — 658.5 Prepaid and other current assets 0.7 106.9 47.9 — 155.5 Total current assets 0.7 1,513.9 495.0 — 2,009.6 Investment in unconsolidated affiliates — 59.1 0.8 — 59.9 Property, plant and equipment, net — 385.8 75.1 — 460.9 Goodwill — 262.9 127.4 11.6 401.9 Intangible assets, net — 590.3 185.9 9.5 785.7 Other assets 10.7 107.8 2.3 (0.4 ) 120.4 Equity investment in subsidiaries 938.7 — — (938.7 ) — Intercompany assets 1,778.4 — — (1,778.4 ) — Total assets $ 2,728.5 $ 2,919.8 $ 886.5 $ (2,696.4 ) $ 3,838.4 LIABILITIES AND EQUITY Current liabilities: Current portion of debt $ 15.0 $ 15.8 $ 16.3 $ (15.0 ) $ 32.1 Accounts payable — 240.6 82.0 — 322.6 Other current liabilities 17.8 261.0 111.2 — 390.0 Total current liabilities 32.8 517.4 209.5 (15.0 ) 744.7 Long-term debt 2,016.1 1,288.2 126.2 (1,375.4 ) 2,055.1 Other liabilities 0.7 270.6 71.2 4.7 347.2 Equity investment in subsidiaries — 31.5 — (31.5 ) — Intercompany liabilities — 97.8 273.6 (371.4 ) — Total liabilities 2,049.6 2,205.5 680.5 (1,788.6 ) 3,147.0 Total equity—controlling interest 678.9 714.3 206.0 (920.3 ) 678.9 Noncontrolling interest — — — 12.5 12.5 Total equity 678.9 714.3 206.0 (907.8 ) 691.4 Total liabilities and equity $ 2,728.5 $ 2,919.8 $ 886.5 $ (2,696.4 ) $ 3,838.4 THE SCOTTS MIRACLE-GRO COMPANY Condensed Consolidating Statement of Operations for the three months ended April 2, 2016 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated Net sales $ — $ 1,069.0 $ 176.2 $ — $ 1,245.2 Cost of sales — 605.2 118.3 — 723.5 Cost of sales—impairment, restructuring and other — 0.1 — — 0.1 Gross profit — 463.7 57.9 — 521.6 Operating expenses: Selling, general and administrative — 162.6 37.9 0.4 200.9 Impairment, restructuring and other — (47.5 ) 0.3 — (47.2 ) Other (income) loss, net — (0.4 ) (0.9 ) — (1.3 ) Income (loss) from operations — 349.0 20.6 (0.4 ) 369.2 Equity (income) loss in subsidiaries (216.6 ) (7.7 ) — 224.3 — Other non-operating (income) loss (8.7 ) — (6.2 ) 14.9 — Interest expense 18.2 14.6 1.2 (14.9 ) 19.1 Income (loss) from continuing operations before income taxes 207.1 342.1 25.6 (224.7 ) 350.1 Income tax (benefit) expense from continuing operations (3.4 ) 118.5 9.2 — 124.3 Income (loss) from continuing operations 210.5 223.6 16.4 (224.7 ) 225.8 Income (loss) from discontinued operations, net of tax — (16.0 ) — — (16.0 ) Net income (loss) $ 210.5 $ 207.6 $ 16.4 $ (224.7 ) $ 209.8 Net (income) loss attributable to noncontrolling interest — — — 0.3 0.3 Net income (loss) attributable to controlling interest $ 210.5 $ 207.6 $ 16.4 $ (224.4 ) $ 210.1 THE SCOTTS MIRACLE-GRO COMPANY Condensed Consolidating Statement of Operations for the six months ended April 2, 2016 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated Net sales $ — $ 1,199.3 $ 240.4 $ — $ 1,439.7 Cost of sales — 730.0 166.3 — 896.3 Cost of sales—impairment, restructuring and other — 5.1 — — 5.1 Gross profit — 464.2 74.1 — 538.3 Operating expenses: Selling, general and administrative — 247.3 66.2 0.7 314.2 Impairment, restructuring and other — (46.2 ) 0.3 — (45.9 ) Other (income) loss, net — (1.3 ) (0.2 ) — (1.5 ) Income (loss) from operations — 264.4 7.8 (0.7 ) 271.5 Equity (income) loss in subsidiaries (149.0 ) (5.3 ) — 154.3 — Other non-operating (income) loss (13.2 ) — (12.3 ) 25.5 — Costs related to refinancing 8.8 — — — 8.8 Interest expense 34.2 24.7 2.0 (25.5 ) 35.4 Income (loss) from continuing operations before income taxes 119.2 245.0 18.1 (155.0 ) 227.3 Income tax (benefit) expense from continuing operations (10.6 ) 84.8 6.5 — 80.7 Income (loss) from continuing operations 129.8 160.2 11.6 (155.0 ) 146.6 Income (loss) from discontinued operations, net of tax — (17.5 ) — — (17.5 ) Net income (loss) $ 129.8 $ 142.7 $ 11.6 $ (155.0 ) $ 129.1 Net (income) loss attributable to noncontrolling interest — — — (0.1 ) (0.1 ) Net income (loss) attributable to controlling interest $ 129.8 $ 142.7 $ 11.6 $ (155.1 ) $ 129.0 THE SCOTTS MIRACLE-GRO COMPANY Condensed Consolidating Statement of Comprehensive Income (Loss) for the three months ended April 2, 2016 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated Net income (loss) $ 210.5 $ 207.6 $ 16.4 $ (224.7 ) $ 209.8 Other comprehensive income (loss), net of tax: Net foreign currency translation adjustment 0.3 — 0.3 (0.3 ) 0.3 Net change in derivatives (0.1 ) 0.3 — (0.3 ) (0.1 ) Net change in pension and other post-retirement benefits 0.2 0.1 0.1 (0.2 ) 0.2 Total other comprehensive income (loss) 0.4 0.4 0.4 (0.8 ) 0.4 Comprehensive income (loss) $ 210.9 $ 208.0 $ 16.8 $ (225.5 ) $ 210.2 THE SCOTTS MIRACLE-GRO COMPANY Condensed Consolidating Statement of Comprehensive Income (Loss) for the six months ended April 2, 2016 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated Net income (loss) $ 129.8 $ 142.7 $ 11.6 $ (155.0 ) $ 129.1 Other comprehensive income (loss), net of tax: Net foreign currency translation adjustment (2.5 ) — (2.5 ) 2.5 (2.5 ) Net change in derivatives 2.0 (0.3 ) — 0.3 2.0 Net change in pension and other post-retirement benefits 0.7 0.4 0.3 (0.7 ) 0.7 Total other comprehensive income (loss) 0.2 0.1 (2.2 ) 2.1 0.2 Comprehensive income (loss) $ 130.0 $ 142.8 $ 9.4 $ (152.9 ) $ 129.3 THE SCOTTS MIRACLE-GRO COMPANY Condensed Consolidating Statement of Cash Flows for the six months ended April 2, 2016 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES (a) $ 292.6 $ (492.8 ) $ (113.8 ) $ (313.8 ) $ (627.8 ) INVESTING ACTIVITIES Proceeds from sale of long-lived assets — 0.2 — — 0.2 Investments in property, plant and equipment — (20.8 ) (3.6 ) — (24.4 ) Investments in loan receivable — (72.0 ) — — (72.0 ) Distributions from (investments in) unconsolidated affiliates — (2.0 ) — — (2.0 ) Investing cash flows from (to) affiliates (395.0 ) — — 395.0 — Net cash provided by (used in) investing activities (395.0 ) (94.6 ) (3.6 ) 395.0 (98.2 ) FINANCING ACTIVITIES Borrowings under revolving and bank lines of credit and term loans — 1,429.7 143.5 — 1,573.2 Repayments under revolving and bank lines of credit and term loans — (925.8 ) (34.0 ) — (959.8 ) Proceeds from issuance of 6.000% Senior Notes 400.0 — — — 400.0 Repayment of 6.625% Senior Notes (200.0 ) — — — (200.0 ) Financing and issuance fees (10.5 ) — — — (10.5 ) Dividends paid (57.7 ) (313.8 ) — 313.8 (57.7 ) Purchase of Common Shares (42.8 ) — — — (42.8 ) Payments on seller notes — (1.8 ) (0.5 ) — (2.3 ) Excess tax benefits from share-based payment arrangements 4.2 — — — 4.2 Cash received from the exercise of stock options 9.2 — — — 9.2 Financing cash flows from (to) affiliates — 398.5 (3.5 ) (395.0 ) — Net cash provided by (used in) financing activities 102.4 586.8 105.5 (81.2 ) 713.5 Effect of exchange rate changes on cash — — (1.6 ) — (1.6 ) Net increase (decrease) in cash and cash equivalents — (0.6 ) (13.5 ) — (14.1 ) Cash and cash equivalents at beginning of period — 8.2 63.2 — 71.4 Cash and cash equivalents at end of period $ — $ 7.6 $ 49.7 $ — $ 57.3 (a) Cash received by the Parent from its subsidiaries in the form of dividends in the amount of $313.8 million represent return on investments and are included in cash flows from operating activities. THE SCOTTS MIRACLE-GRO COMPANY Condensed Consolidating Balance Sheet As of April 2, 2016 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated ASSETS Current assets: Cash and cash equivalents $ — $ 7.6 $ 49.7 $ — $ 57.3 Accounts receivable, net — 731.0 223.7 — 954.7 Accounts receivable pledged — 208.4 — — 208.4 Inventories — 483.5 136.1 — 619.6 Assets held for sale — 208.7 — — 208.7 Prepaid and other current assets — 122.1 38.0 — 160.1 Total current assets — 1,761.3 447.5 — 2,208.8 Property, plant and equipment, net — 382.3 54.0 — 436.3 Goodwill — 260.5 12.8 11.6 284.9 Intangible assets, net — 602.0 33.8 11.0 646.8 Other assets 15.6 87.2 15.0 (15.3 ) 102.5 Equity investment in subsidiaries 634.8 — — (634.8 ) — Intercompany assets 1,814.0 — — (1,814.0 ) — Total assets $ 2,464.4 $ 3,093.3 $ 563.1 $ (2,441.5 ) $ 3,679.3 LIABILITIES AND EQUITY Current liabilities: Current portion of debt $ 15.0 $ 182.9 $ 20.0 $ (15.0 ) $ 202.9 Accounts payable — 221.9 71.9 — 293.8 Liabilities held for sale — 62.1 — — 62.1 Other current liabilities 18.9 318.0 90.2 — 427.1 Total current liabilities 33.9 784.9 182.1 (15.0 ) 985.9 Long-term debt 1,750.0 1,168.8 196.0 (1,356.3 ) 1,758.5 Other liabilities 5.1 221.0 31.2 (10.3 ) 247.0 Equity investment in subsidiaries — 176.9 — (176.9 ) — Intercompany liabilities — 269.0 64.0 (333.0 ) — Total liabilities 1,789.0 2,620.6 473.3 (1,891.5 ) 2,991.4 Total equity—controlling interest 675.4 472.7 89.8 (562.5 ) 675.4 Noncontrolling interest — — — 12.5 12.5 Total equity 675.4 472.7 89.8 (550.0 ) 687.9 Total liabilities and equity $ 2,464.4 $ 3,093.3 $ 563.1 $ (2,441.5 ) $ 3,679.3 THE SCOTTS MIRACLE-GRO COMPANY Condensed Consolidating Balance Sheet As of September 30, 2016 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated ASSETS Current assets: Cash and cash equivalents $ — $ 2.7 $ 47.4 $ — $ 50.1 Accounts receivable, net — 92.4 104.0 — 196.4 Accounts receivable pledged — 174.7 — — 174.7 Inventories — 327.8 120.4 — 448.2 Prepaid and other current assets 0.1 82.8 39.4 — 122.3 Total current assets 0.1 680.4 311.2 — 991.7 Investment in unconsolidated affiliates — 100.3 0.7 — 101.0 Property, plant and equipment, net — 392.1 78.7 — 470.8 Goodwill — 260.4 101.2 11.6 373.2 Intangible assets, net — 596.4 144.3 10.2 750.9 Other assets 13.2 103.8 0.7 (2.5 ) 115.2 Equity investment in subsidiaries 808.8 — — (808.8 ) — Intercompany assets 1,013.0 — — (1,013.0 ) — Total assets $ 1,835.1 $ 2,133.4 $ 636.8 $ (1,802.5 ) $ 2,802.8 LIABILITIES AND EQUITY Current liabilities: Current portion of debt $ 15.0 $ 154.2 $ 30.8 $ (15.0 ) $ 185.0 Accounts payable — 108.8 57.1 — 165.9 Other current liabilities 16.6 143.6 82.0 — 242.2 Total current liabilities 31.6 406.6 169.9 (15.0 ) 593.1 Long-term debt 1,085.1 575.7 117.2 (652.9 ) 1,125.1 Other liabilities 3.2 268.7 76.0 2.4 350.3 Equity investment in subsidiaries — 161.0 — (161.0 ) — Intercompany liabilities — 147.2 187.1 (334.3 ) — Total liabilities 1,119.9 1,559.2 550.2 (1,160.8 ) 2,068.5 Total equity—controlling interest 715.2 574.2 86.6 (660.8 ) 715.2 Noncontrolling interest — — — 19.1 19.1 Total equity 715.2 574.2 86.6 (641.7 ) 734.3 Total liabilities and equity $ 1,835.1 $ 2,133.4 $ 636.8 $ (1,802.5 ) $ 2,802.8 |
SUMMARY OF SIGNIFICANT ACCOUN26
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Apr. 01, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Accounting | The Company’s unaudited condensed consolidated financial statements for the three and six months ended April 1, 2017 and April 2, 2016 are presented in accordance with accounting principles generally accepted in the United States of America (“GAAP”). |
Consolidation | The condensed consolidated financial statements include the accounts of Scotts Miracle-Gro and its subsidiaries. All intercompany transactions and accounts have been eliminated in consolidation. The Company’s consolidation criteria are based on majority ownership (as evidenced by a majority voting interest in the entity) and an objective evaluation and determination of effective management control. AeroGrow International, Inc. (“AeroGrow”) and Gavita Holdings B.V., and its subsidiaries (collectively, “Gavita”), in which the Company has controlling interests, are consolidated, with the equity owned by other shareholders shown as noncontrolling interest in the Condensed Consolidated Balance Sheets, and the other shareholders’ portion of net earnings and other comprehensive income shown as net income (loss) or comprehensive income attributable to noncontrolling interest in the Condensed Consolidated Statements of Operations and Condensed Consolidated Statements of Comprehensive Income (Loss), respectively. |
Use of Estimates | Use of Estimates The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the amounts reported in the condensed consolidated financial statements and accompanying notes and related disclosures. Although these estimates are based on management’s best knowledge of current events and actions the Company may undertake in the future, actual results ultimately may differ from the estimates. |
Loans Receivable | Loans Receivable Loans receivable are carried at outstanding principal amount, and are recognized in the “Other assets” line in the Condensed Consolidated Balance Sheets. Loans receivable are impaired when, based on current information and events, it is probable that the Company will be unable to collect all amounts due according to the contractual terms of the loan agreement. If it is determined that an impairment has occurred, an impairment loss is recognized for the amount by which the carrying value of the asset exceeds the present value of expected future cash flows and recorded within “Operating expenses” in the Condensed Consolidated Statements of Operations. Interest income is recorded on an accrual basis, and is recognized in the “Other income, net” line in the Condensed Consolidated Statements of Operations. |
Statements of Cash Flows | The Company uses the “cumulative earnings” approach for determining cash flow presentation of distributions from unconsolidated affiliates. Distributions received are included in the Condensed Consolidated Statements of Cash Flows as operating activities, unless the cumulative distributions exceed the portion of the cumulative equity in the net earnings of the unconsolidated affiliate, in which case the excess distributions are deemed to be returns of the investment and are classified as investing activities in the Condensed Consolidated Statements of Cash Flows. |
Recent Accounting Pronouncements | RECENT ACCOUNTING PRONOUNCEMENTS Debt Issuance Costs In April 2015, the Financial Accounting Standards Board (“FASB”) issued an accounting standard update that requires debt issuance costs related to a recognized debt liability to be presented in the balance sheet as a direct deduction from the corresponding debt liability rather than as an asset; however debt issuance costs relating to revolving credit facilities will remain in other assets. The Company adopted this guidance on a retrospective basis effective October 1, 2016. As a result, debt issuance costs totaling $6.3 million and $6.0 million have been presented as a component of the carrying amount of long-term debt in the Condensed Consolidated Balance Sheets as of April 2, 2016 and September 30, 2016 , respectively. These amounts were previously reported within other assets. Business Combinations In September 2015, the FASB issued an accounting standard update to simplify the accounting for measurement-period adjustments by requiring an acquirer to recognize adjustments to provisional amounts that are identified during the measurement period in the reporting period in which the adjustment amounts are determined, and requiring disclosure of the portion of the amount recorded in current period earnings by line item that would have been recorded in previous reporting periods if the adjustment to the provisional amounts had been recognized as of the acquisition date. The Company adopted this guidance on a prospective basis effective October 1, 2016. The adoption of this guidance did not impact the Company’s consolidated financial position, results of operations or cash flows. Revenue Recognition from Contracts with Customers In May 2014, the FASB issued amended accounting guidance that replaces most existing revenue recognition guidance under GAAP. This guidance requires companies to recognize revenue in a manner that depicts the transfer of promised goods or services to customers in amounts that reflect the consideration to which a company expects to be entitled in exchange for those goods or services. The new standard also will result in enhanced disclosures about the nature, amount, timing and uncertainty of revenue and cash flows arising from contracts with customers. Subsequently, additional guidance was issued on several areas including guidance intended to improve the operability and understandability of the implementation of principal versus agent considerations and clarifications on the identification of performance obligations and implementation of guidance related to licensing. The provisions are effective for the Company’s financial statements no later than the fiscal year beginning October 1, 2018. The standard allows for either a full retrospective or a modified retrospective transition method. The Company is currently evaluating the impact of this standard on its consolidated results of operations, financial position and cash flows. Inventory In July 2015, the FASB issued an accounting standard update that requires inventory to be measured “at the lower of cost and net realizable value,” thereby simplifying the current guidance that requires inventory to be measured at the lower of cost or market (market in this context is defined as one of three different measures, one of which is net realizable value). The provisions are effective prospectively for the Company’s financial statements for the fiscal year beginning October 1, 2017, and are not expected to have a significant impact on the Company’s consolidated financial position, results of operations or cash flows. Income Taxes In November 2015, the FASB issued an accounting standard update to simplify the presentation of deferred income taxes by requiring that deferred income tax liabilities and assets be classified as noncurrent in a classified statement of financial position. The provisions are effective for the Company’s financial statements no later than the fiscal year beginning October 1, 2017. The standard allows for either a retrospective or prospective transition method and is not expected to have a significant impact on the Company’s consolidated financial position, results of operations or cash flows. At April 1, 2017 , April 2, 2016 and September 30, 2016 , net current deferred tax assets classified within prepaid and other current assets were $61.4 million , $72.4 million and $62.1 million , respectively. Leases In February 2016, the FASB issued an accounting standard update which significantly changes the accounting for leases. This guidance requires lessees to recognize a lease liability for the obligation to make lease payments and a right-of-use asset for the right to use the underlying asset for the lease term. The provisions are effective for the Company’s financial statements no later than the fiscal year beginning October 1, 2019 and require a modified retrospective transition approach for leases that exist or are entered into after the beginning of the earliest comparative period presented in the financial statements. The Company is currently evaluating the impact of this standard on its consolidated results of operations, financial position and cash flows. Share-Based Compensation In March 2016, the FASB issued an accounting standard update that simplifies several aspects of the accounting for employee share-based payment transactions, including the accounting for income taxes, forfeitures, and statutory tax withholding requirements, as well as classification in the statement of cash flows. The provisions are effective, using a combination of retrospective, modified retrospective and prospective transition methods, for the Company’s financial statements no later than the fiscal year beginning October 1, 2017. The Company is currently evaluating the impact of this standard on its consolidated results of operations, financial position and cash flows. Cash Flow Presentation In August 2016, the FASB issued an accounting standard update that amends the guidance on the classification of certain cash receipts and payments in the statement of cash flows. The provisions are effective retrospectively for the Company’s financial statements no later than the fiscal year beginning October 1, 2018, and are not expected to have a significant impact on the Company’s consolidated cash flows. Business Combinations In January 2017, the FASB issued an accounting standard update that clarifies the definition of a business to provide additional guidance to assist in evaluating whether transactions should be accounted for as an acquisition (or disposal) of either an asset or business. The provisions are effective prospectively for the Company’s financial statements no later than the fiscal year beginning October 1, 2018, and are not expected to have a significant impact on the Company’s consolidated financial position, results of operations or cash flows. Goodwill In January 2017, the FASB issued an accounting standard update which removes the requirement to compare the implied fair value of goodwill with its carrying amount as part of step 2 of the goodwill impairment test. Goodwill impairment will now be the amount by which a reporting unit’s carrying value exceeds its fair value, not to exceed the carrying amount of the goodwill. The provisions are effective prospectively for the Company’s financial statements no later than the fiscal year beginning October 1, 2020, and are not expected to have a significant impact on the Company’s consolidated financial position, results of operations or cash flows. Employee Benefit Plans In March 2017, the FASB issued an accounting standard update which requires entities to (1) disaggregate the current-service-cost component from the other components of net benefit cost (the “other components”) and present it with other current compensation costs for related employees in the income statement, (2) present the other components elsewhere in the income statement and outside of income from operations if that subtotal is presented and (3) limit the amount of costs eligible for capitalization (e.g., as part of inventory or property, plant, and equipment) to only the service-cost component of net benefit cost. The provisions are effective for the Company’s financial statements no later than the fiscal year beginning October 1, 2018, and are required to be applied retrospectively for the presentation of cost components in the income statement and prospectively for the capitalization of cost components. The provisions are not expected to have a significant impact on the Company’s consolidated financial position, results of operations or cash flows. |
SUMMARY OF SIGNIFICANT ACCOUN27
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Tables) | 6 Months Ended |
Apr. 01, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Supplemental Cash Flow Information | Supplemental cash flow information was as follows for each of the periods presented: SIX MONTHS ENDED APRIL 1, APRIL 2, (In millions) Interest paid $ (26.5 ) $ (23.0 ) Call premium on 6.625% Senior Notes — (6.6 ) Income taxes paid (3.2 ) (2.2 ) |
DISCONTINUED OPERATIONS (Tables
DISCONTINUED OPERATIONS (Tables) | 6 Months Ended |
Apr. 01, 2017 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Summary of Discontinued Operations | The following table summarizes the results of the SLS Business within discontinued operations for each of the periods presented: THREE MONTHS ENDED SIX MONTHS ENDED APRIL 1, APRIL 2, APRIL 1, APRIL 2, (In millions) Net sales $ — $ 40.9 $ — $ 92.0 Operating costs — 55.7 — 107.1 Impairment, restructuring and other 0.1 10.6 0.7 13.6 Other income, net — (0.7 ) — (1.5 ) Adjustment to gain on contribution of SLS Business — — 0.3 — Loss from discontinued operations before income taxes (0.1 ) (24.7 ) (1.0 ) (27.2 ) Income tax benefit from discontinued operations — (8.7 ) (0.3 ) (9.7 ) Loss from discontinued operations, net of tax $ (0.1 ) $ (16.0 ) $ (0.7 ) $ (17.5 ) The following table summarizes the major classes of assets and liabilities of the SLS Business held for sale as of April 2, 2016 (in millions): Accounts receivable, net $ 17.2 Inventories 13.8 Prepaid and other assets 13.1 Property, plant and equipment, net 8.4 Goodwill and intangible assets, net 156.2 Assets held for sale $ 208.7 Current portion of debt $ 0.3 Accounts payable 4.5 Other current liabilities 52.1 Long-term debt 3.3 Other liabilities 1.9 Liabilities held for sale $ 62.1 |
INVESTMENT IN UNCONSOLIDATED 29
INVESTMENT IN UNCONSOLIDATED AFFILIATES (Tables) | 6 Months Ended |
Apr. 01, 2017 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Summary of Joint Venture Financial Information | The following table presents summarized financial information for the TruGreen Joint Venture for each of the periods presented: THREE MONTHS ENDED SIX MONTHS ENDED APRIL 1, APRIL 1, (in millions) Net sales $ 154.7 $ 406.8 Gross margin 9.7 70.8 Depreciation and amortization 36.6 56.8 Interest expense 16.6 33.5 Selling, general, administrative and other 36.6 78.0 Restructuring and other charges — 26.6 Net loss $ (80.1 ) $ (124.1 ) |
IMPAIRMENT, RESTRUCTURING AND30
IMPAIRMENT, RESTRUCTURING AND OTHER (Tables) | 6 Months Ended |
Apr. 01, 2017 | |
Restructuring and Related Activities [Abstract] | |
Schedules of Impairment, Restructuring and Other Charges, and Activity Related to Liabilities | The following table details impairment, restructuring and other charges (recoveries) for each of the periods presented: THREE MONTHS ENDED SIX MONTHS ENDED APRIL 1, APRIL 2, APRIL 1, APRIL 2, (In millions) Cost of sales—impairment, restructuring and other: Restructuring and other charges $ — $ 0.1 $ — $ 5.1 Operating expenses: Restructuring and other charges (recoveries) 3.3 (47.2 ) 4.7 (45.9 ) Impairment, restructuring and other charges (recoveries) from continuing operations $ 3.3 $ (47.1 ) $ 4.7 $ (40.8 ) Restructuring and other charges from discontinued operations 0.1 10.6 0.7 13.6 Total impairment, restructuring and other charges (recoveries) $ 3.4 $ (36.5 ) $ 5.4 $ (27.2 ) The following table summarizes the activity related to liabilities associated with restructuring and other, excluding insurance reimbursement recoveries, during the six months ended April 1, 2017 (in millions): Amounts reserved for restructuring and other at September 30, 2016 $ 20.8 Restructuring and other charges from continuing operations 4.7 Restructuring and other charges from discontinued operations 0.7 Payments and other (20.0 ) Amounts reserved for restructuring and other at April 1, 2017 $ 6.2 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 6 Months Ended |
Apr. 01, 2017 | |
Inventory Disclosure [Abstract] | |
Summary of Inventories | Inventories consisted of the following for each of the periods presented: APRIL 1, APRIL 2, SEPTEMBER 30, (In millions) Finished goods $ 439.0 $ 419.2 $ 248.7 Work-in-process 58.2 50.4 56.9 Raw materials 161.3 150.0 142.6 Total inventories $ 658.5 $ 619.6 $ 448.2 |
MARKETING AGREEMENT (Tables)
MARKETING AGREEMENT (Tables) | 6 Months Ended |
Apr. 01, 2017 | |
Marketing Agreement [Abstract] | |
Schedule of Net Commission and Reimbursements Earned Under Marketing Agreement | The elements of the net commission and reimbursements earned under the Marketing Agreement and included in “Net sales” are as follows: THREE MONTHS ENDED SIX MONTHS ENDED APRIL 1, APRIL 2, APRIL 1, APRIL 2, (In millions) Gross commission $ 46.8 $ 54.9 $ 48.2 $ 54.9 Contribution expenses (5.0 ) (5.0 ) (10.0 ) (10.0 ) Amortization of marketing fee (0.2 ) (0.2 ) (0.4 ) (0.4 ) Net commission 41.6 49.7 37.8 44.5 Reimbursements associated with Marketing Agreement 21.7 22.8 38.3 36.8 Total net sales associated with Marketing Agreement $ 63.3 $ 72.5 $ 76.1 $ 81.3 |
DEBT (Tables)
DEBT (Tables) | 6 Months Ended |
Apr. 01, 2017 | |
Debt Disclosure [Abstract] | |
Components of Long-Term Debt | The components of long-term debt are as follows: APRIL 1, APRIL 2, SEPTEMBER 30, (In millions) Credit Facilities: Revolving loans $ 1,109.0 $ 1,075.0 $ 417.4 Term loans 281.3 296.3 288.8 Senior Notes – 5.250% 250.0 — — Senior Notes – 6.000% 400.0 400.0 400.0 Master Accounts Receivable Purchase Agreement — 166.7 138.6 Other 56.1 29.7 71.3 Total debt 2,096.4 1,967.7 1,316.1 Less current portions 32.1 202.9 185.0 Less unamortized debt issuance costs 9.2 6.3 6.0 Long-term debt $ 2,055.1 $ 1,758.5 $ 1,125.1 |
Schedule of Interest Rate Swap Agreements | The notional amount, effective date, expiration date and rate of each of these swap agreements outstanding at April 1, 2017 are shown in the table below: Notional Amount (in millions) Effective Date (a) Expiration Date Fixed Rate $ 50 (d) 12/6/2012 9/6/2017 2.96 % 200 2/7/2014 11/7/2017 1.28 % 300 (e) 11/21/2016 6/20/2018 0.83 % 200 (e) 11/7/2016 8/7/2018 0.84 % 150 (b) 2/7/2017 5/7/2019 2.12 % 50 (b) 2/7/2017 5/7/2019 2.25 % 200 (c) 12/20/2016 6/20/2019 2.12 % (a) The effective date refers to the date on which interest payments were first hedged by the applicable swap agreement. (b) Interest payments made during the three-month period of each year that begins with the month and day of the effective date are hedged by the swap agreement. (c) Interest payments made during the six-month period of each year that begins with the month and day of the effective date are hedged by the swap agreement. (d) Interest payments made during the nine-month period of each year that begins with the month and day of the effective date are hedged by the swap agreement. (e) Notional amount adjusts in accordance with a specified seasonal schedule. This represents the maximum notional amount at any point in time. The Company had the following outstanding commodity contracts that were entered into to hedge forecasted purchases: COMMODITY APRIL 1, APRIL 2, SEPTEMBER 30, Urea 28,500 tons 21,000 tons 40,500 tons Diesel 5,544,000 gallons 5,922,000 gallons 6,384,000 gallons Heating Oil 1,680,000 gallons 1,974,000 gallons 1,722,000 gallons |
RETIREMENT AND RETIREE MEDICA34
RETIREMENT AND RETIREE MEDICAL PLANS (Tables) | 6 Months Ended |
Apr. 01, 2017 | |
Defined Contribution Pension and Other Postretirement Plans Disclosure [Abstract] | |
Summary of the Components of Net Periodic Benefit Cost | The following summarizes the components of net periodic benefit (income) cost for the retirement and retiree medical plans sponsored by the Company: THREE MONTHS ENDED APRIL 1, 2017 APRIL 2, 2016 U.S. Pension International Pension U.S. Medical U.S. Pension International Pension U.S. Medical (In millions) Service cost $ — $ 0.3 $ 0.1 $ — $ 0.3 $ 0.1 Interest cost 0.7 0.9 0.1 1.1 1.7 0.2 Expected return on plan assets (1.2 ) (2.0 ) — (1.3 ) (2.0 ) — Net amortization 0.4 0.6 (0.2 ) 0.5 0.4 (0.2 ) Net periodic benefit (income) cost $ (0.1 ) $ (0.2 ) $ — $ 0.3 $ 0.4 $ 0.1 SIX MONTHS ENDED APRIL 1, 2017 APRIL 2, 2016 U.S. Pension International Pension U.S. Medical U.S. Pension International Pension U.S. Medical (In millions) Service cost $ — $ 0.6 $ 0.2 $ — $ 0.6 $ 0.2 Interest cost 1.4 1.9 0.3 2.2 3.4 0.5 Expected return on plan assets (2.4 ) (4.0 ) — (2.5 ) (4.0 ) — Net amortization 0.8 1.1 (0.4 ) 0.9 0.8 (0.5 ) Net periodic benefit (income) cost $ (0.2 ) $ (0.4 ) $ 0.1 $ 0.6 $ 0.8 $ 0.2 |
EQUITY (Tables)
EQUITY (Tables) | 6 Months Ended |
Apr. 01, 2017 | |
Equity [Abstract] | |
Summary of Changes in Equity | The following table provides a summary of the changes in total equity, shareholders’ equity attributable to controlling interest, and equity attributable to noncontrolling interests for the six months ended April 1, 2017 and April 2, 2016 (in millions): Common Shares and Capital in Excess of Stated Value Retained Earnings Treasury Shares Accumulated Other Comprehensive Loss Total Equity - Controlling Interest Non-controlling Interest Total Equity Balance at September 30, 2015 $ 400.4 $ 684.2 $ (357.1 ) $ (106.8 ) $ 620.7 $ 12.4 $ 633.1 Net income (loss) — 129.0 — — 129.0 0.1 129.1 Other comprehensive income — — — 0.2 0.2 — 0.2 Share-based compensation 15.5 — — — 15.5 — 15.5 Dividends declared ($0.940 per share) — (56.8 ) — — (56.8 ) — (56.8 ) Treasury share purchases — — (42.8 ) — (42.8 ) — (42.8 ) Treasury share issuances (14.0 ) — 23.6 — 9.6 — 9.6 Balance at April 2, 2016 $ 401.9 $ 756.4 $ (376.3 ) $ (106.6 ) $ 675.4 $ 12.5 $ 687.9 Balance at September 30, 2016 $ 401.7 $ 881.8 $ (451.4 ) $ (116.9 ) $ 715.2 $ 19.1 $ 734.3 Net income (loss) — 99.8 — — 99.8 0.5 100.3 Other comprehensive income — — — 3.2 3.2 — 3.2 Share-based compensation 19.1 — — — 19.1 — 19.1 Dividends declared ($1.000 per share) — (60.6 ) — — (60.6 ) — (60.6 ) Treasury share purchases — — (90.6 ) — (90.6 ) — (90.6 ) Treasury share issuances (20.0 ) — 13.8 — (6.2 ) — (6.2 ) Adjustment to noncontrolling interest due to ownership change (1.0 ) — — — (1.0 ) 1.0 — Distribution declared by AeroGrow — — — — — (8.1 ) (8.1 ) Balance at April 1, 2017 $ 399.8 $ 921.0 $ (528.2 ) $ (113.7 ) $ 678.9 $ 12.5 $ 691.4 |
Schedule of Share-Based Awards Granted | The following is a summary of the share-based awards granted during each of the periods indicated: SIX MONTHS ENDED APRIL 1, APRIL 2, Employees Stock options — 444,890 Restricted stock units 102,143 70,594 Performance units 487,674 56,315 Board of Directors Deferred stock units 22,902 26,560 Total share-based awards 612,719 598,359 Aggregate fair value at grant dates (in millions) $ 56.9 $ 16.0 |
Schedule of Share-Based Compensation | Total share-based compensation was as follows for each of the periods indicated: THREE MONTHS ENDED SIX MONTHS ENDED APRIL 1, APRIL 2, APRIL 1, APRIL 2, (In millions) Share-based compensation $ 12.8 $ 9.1 $ 15.1 $ 11.3 Tax benefit recognized 4.9 3.5 5.8 4.3 |
Schedule of Aggregate Stock Option Activity | Aggregate stock option activity was as follows: No. of Options Wtd. Avg. Exercise Price Awards outstanding at September 30, 2016 1,801,041 $ 51.38 Exercised (38,757 ) 42.95 Forfeited (9,587 ) 62.86 Awards outstanding at April 1, 2017 1,752,697 51.44 Exercisable 928,489 38.30 |
Summary of Certain Information Pertaining to Stock Option Awards Outstanding and Exercisable | The following summarizes certain information pertaining to stock option awards outstanding and exercisable at April 1, 2017 : Awards Outstanding Awards Exercisable Range of No. of Options Wtd. Avg. Remaining Life Wtd. Avg. Exercise Price No. of Options Wtd. Avg. Remaining Life Wtd. Avg. Exercise Price $20.59 – $20.59 210,386 1.51 $ 20.59 210,386 1.51 $ 20.59 $36.37 – $36.86 157,940 0.60 36.44 157,940 0.60 36.44 $38.81 – $49.19 557,647 3.91 45.39 557,647 3.91 45.39 $63.43 – $68.68 826,724 8.35 66.23 2,516 7.83 63.43 1,752,697 5.42 51.44 928,489 2.81 38.30 |
Schedule of Intrinsic Value of Stock Option Awards Outstanding and Exercisable | The intrinsic values of stock option awards outstanding and exercisable at April 1, 2017 were as follows (in millions): Outstanding $ 73.5 Exercisable 51.2 |
Schedule of Restricted Share-Based Award Activity | Restricted share-based award activity (including restricted stock units and deferred stock units) was as follows: No. of Shares Wtd. Avg. Grant Date Fair Value per Share Awards outstanding at September 30, 2016 305,663 $ 66.31 Granted 125,045 92.66 Vested (131,357 ) 60.68 Forfeited (2,010 ) 67.24 Awards outstanding at April 1, 2017 297,341 79.88 |
Schedule of Performance-Based Award Activity | Performance-based award activity was as follows (based on target award amounts): No. of Units Wtd. Avg. Grant Date Fair Value per Unit Awards outstanding at September 30, 2016 266,598 $ 62.52 Granted (a) 487,674 92.95 Vested (147,698 ) 59.82 Forfeited (8,941 ) 62.81 Awards outstanding at April 1, 2017 597,633 88.01 (a) Includes 465,461 units issued to certain senior executives as part of the Company’s Project Focus initiative. |
DERIVATIVE INSTRUMENTS AND HE36
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Tables) | 6 Months Ended |
Apr. 01, 2017 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Summary of Outstanding Derivative Contracts | The notional amount, effective date, expiration date and rate of each of these swap agreements outstanding at April 1, 2017 are shown in the table below: Notional Amount (in millions) Effective Date (a) Expiration Date Fixed Rate $ 50 (d) 12/6/2012 9/6/2017 2.96 % 200 2/7/2014 11/7/2017 1.28 % 300 (e) 11/21/2016 6/20/2018 0.83 % 200 (e) 11/7/2016 8/7/2018 0.84 % 150 (b) 2/7/2017 5/7/2019 2.12 % 50 (b) 2/7/2017 5/7/2019 2.25 % 200 (c) 12/20/2016 6/20/2019 2.12 % (a) The effective date refers to the date on which interest payments were first hedged by the applicable swap agreement. (b) Interest payments made during the three-month period of each year that begins with the month and day of the effective date are hedged by the swap agreement. (c) Interest payments made during the six-month period of each year that begins with the month and day of the effective date are hedged by the swap agreement. (d) Interest payments made during the nine-month period of each year that begins with the month and day of the effective date are hedged by the swap agreement. (e) Notional amount adjusts in accordance with a specified seasonal schedule. This represents the maximum notional amount at any point in time. The Company had the following outstanding commodity contracts that were entered into to hedge forecasted purchases: COMMODITY APRIL 1, APRIL 2, SEPTEMBER 30, Urea 28,500 tons 21,000 tons 40,500 tons Diesel 5,544,000 gallons 5,922,000 gallons 6,384,000 gallons Heating Oil 1,680,000 gallons 1,974,000 gallons 1,722,000 gallons |
Schedule of the Fair Values of Derivative Instruments | The fair values of the Company’s derivative instruments were as follows: ASSETS / (LIABILITIES) DERIVATIVES DESIGNATED AS HEDGING INSTRUMENTS APRIL 1, APRIL 2, SEPTEMBER 30, BALANCE SHEET LOCATION FAIR VALUE (In millions) Interest rate swap agreements Prepaid and other current assets $ 0.7 $ — $ — Other assets 0.8 — — Other current liabilities (1.9 ) (5.8 ) (3.3 ) Other liabilities (0.7 ) (5.1 ) (3.1 ) Commodity hedging instruments Other current liabilities (0.2 ) (0.7 ) (0.3 ) Total derivatives designated as hedging instruments $ (1.3 ) $ (11.6 ) $ (6.7 ) DERIVATIVES NOT DESIGNATED AS HEDGING INSTRUMENTS BALANCE SHEET LOCATION Currency forward contracts Prepaid and other current assets $ 0.5 $ — $ 1.2 Other current liabilities (4.0 ) (0.2 ) (0.8 ) Commodity hedging instruments Other current liabilities (0.1 ) (3.8 ) (0.1 ) Total derivatives not designated as hedging instruments (3.6 ) (4.0 ) 0.3 Total derivatives $ (4.9 ) $ (15.6 ) $ (6.4 ) |
Schedule of the Effect of Derivative Instruments on AOCI and Statements of Operations | The effect of derivative instruments on AOCI and the Condensed Consolidated Statements of Operations was as follows: DERIVATIVES IN CASH FLOW HEDGING RELATIONSHIPS AMOUNT OF GAIN / (LOSS) RECOGNIZED IN AOCI THREE MONTHS ENDED SIX MONTHS ENDED APRIL 1, APRIL 2, APRIL 1, APRIL 2, (In millions) Interest rate swap agreements $ 0.4 $ (2.6 ) $ 2.5 $ (0.9 ) Commodity hedging instruments (0.4 ) (0.3 ) 0.5 (0.7 ) Total $ — $ (2.9 ) $ 3.0 $ (1.6 ) DERIVATIVES IN CASH FLOW HEDGING RELATIONSHIPS RECLASSIFIED FROM AOCI INTO STATEMENT OF OPERATIONS AMOUNT OF GAIN / (LOSS) THREE MONTHS ENDED SIX MONTHS ENDED APRIL 1, APRIL 2, APRIL 1, APRIL 2, (In millions) Interest rate swap agreements Interest expense $ (0.9 ) $ (2.2 ) $ (1.2 ) $ (3.2 ) Commodity hedging instruments Cost of sales (0.2 ) (0.6 ) (0.3 ) (0.4 ) Total $ (1.1 ) $ (2.8 ) $ (1.5 ) $ (3.6 ) DERIVATIVES NOT DESIGNATED AS HEDGING INSTRUMENTS RECOGNIZED IN STATEMENT OF OPERATIONS AMOUNT OF GAIN / (LOSS) THREE MONTHS ENDED SIX MONTHS ENDED APRIL 1, APRIL 2, APRIL 1, APRIL 2, (In millions) Currency forward contracts Other income, net $ (2.2 ) $ (0.3 ) $ 7.0 $ (1.1 ) Commodity hedging instruments Cost of sales (0.9 ) (1.0 ) — (4.3 ) Total $ (3.1 ) $ (1.3 ) $ 7.0 $ (5.4 ) |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 6 Months Ended |
Apr. 01, 2017 | |
Fair Value Disclosures [Abstract] | |
Summary of Financial Assets and Liabilities Measured at Fair Value on a Recurring Basis | The following table presents the Company’s financial assets and liabilities measured at fair value on a recurring basis at April 1, 2017 : Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Unobservable Inputs (Level 3) Total (In millions) Assets Cash equivalents $ 17.7 $ — $ — $ 17.7 Derivatives Interest rate swap agreements — 1.5 — 1.5 Currency forward contracts — 0.5 — 0.5 Other 14.5 — 10.9 25.4 Total $ 32.2 $ 2.0 $ 10.9 $ 45.1 Liabilities Derivatives Interest rate swap agreements $ — $ (2.6 ) $ — $ (2.6 ) Currency forward contracts — (4.0 ) — (4.0 ) Commodity hedging instruments — (0.3 ) — (0.3 ) Long-term debt — — (37.2 ) (37.2 ) Total $ — $ (6.9 ) $ (37.2 ) $ (44.1 ) The following table presents the Company’s financial assets and liabilities measured at fair value on a recurring basis at April 2, 2016 : Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Unobservable Inputs (Level 3) Total (In millions) Assets Cash equivalents $ 22.6 $ — $ — $ 22.6 Other 11.1 — — 11.1 Total $ 33.7 $ — $ — $ 33.7 Liabilities Derivatives Interest rate swap agreements $ — $ (10.9 ) $ — $ (10.9 ) Currency forward contracts — (0.2 ) — (0.2 ) Commodity hedging instruments — (4.5 ) — (4.5 ) Total $ — $ (15.6 ) $ — $ (15.6 ) The following table presents the Company’s financial assets and liabilities measured at fair value on a recurring basis at September 30, 2016 : Quoted Prices in Active Markets for Identical Assets (Level 1) Significant Other Observable Inputs (Level 2) Unobservable Inputs (Level 3) Total (In millions) Assets Cash equivalents $ 11.5 $ — $ — $ 11.5 Derivatives Currency forward contracts — 1.2 — 1.2 Other 11.8 — 10.9 22.7 Total $ 23.3 $ 1.2 $ 10.9 $ 35.4 Liabilities Derivatives Interest rate swap agreements $ — $ (6.4 ) $ — $ (6.4 ) Currency forward contracts — (0.8 ) — (0.8 ) Commodity hedging instruments — (0.4 ) — (0.4 ) Long-term debt — — (38.3 ) (38.3 ) Total $ — $ (7.6 ) $ (38.3 ) $ (45.9 ) |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 6 Months Ended |
Apr. 01, 2017 | |
Segment Reporting [Abstract] | |
Summary of Segment Financial Information | The following tables present summarized financial information concerning the Company’s reportable segments for the periods indicated: THREE MONTHS ENDED SIX MONTHS ENDED APRIL 1, APRIL 2, APRIL 1, APRIL 2, (In millions) Net sales: U.S. Consumer $ 962.5 $ 1,039.7 $ 1,088.0 $ 1,152.9 Europe Consumer 105.3 115.0 129.7 140.7 Other 135.7 90.5 232.6 146.1 Consolidated $ 1,203.5 $ 1,245.2 $ 1,450.3 $ 1,439.7 Segment Profit (Loss): U.S. Consumer $ 313.8 $ 336.0 $ 275.8 $ 281.8 Europe Consumer 18.3 21.6 9.9 12.4 Other 15.1 4.6 20.7 5.1 Total Segment Profit 347.2 362.2 306.4 299.3 Corporate (35.9 ) (35.7 ) (58.8 ) (60.1 ) Intangible asset amortization (6.1 ) (4.3 ) (11.9 ) (8.2 ) Impairment, restructuring and other (3.3 ) 47.0 (4.7 ) 40.5 Equity in loss of unconsolidated affiliates (a) (24.1 ) — (37.3 ) — Costs related to refinancing — — — (8.8 ) Interest expense (21.5 ) (19.1 ) (37.1 ) (35.4 ) Income from continuing operations before income taxes $ 256.3 $ 350.1 $ 156.6 $ 227.3 (a) Included within loss of unconsolidated affiliates for the three and six months ended April 1, 2017 are charges of $2.1 million and $11.7 million , respectively, which represent the Company’s share of restructuring and other charges incurred by the TruGreen Joint Venture. APRIL 1, APRIL 2, SEPTEMBER 30, (In millions) Total assets: U.S. Consumer $ 2,601.3 $ 2,636.0 $ 1,770.7 Europe Consumer 275.1 322.6 192.1 Other 726.4 367.8 568.1 Corporate 235.6 144.2 271.9 Assets held for sale — 208.7 — Consolidated $ 3,838.4 $ 3,679.3 $ 2,802.8 |
FINANCIAL INFORMATION FOR SUB39
FINANCIAL INFORMATION FOR SUBSIDIARY GUARANTORS AND NON-GUARANTORS (Tables) | 6 Months Ended |
Apr. 01, 2017 | |
Condensed Financial Information of Parent Subsidiary Guarantors and Subsidiary Non Guarantors [Abstract] | |
Condensed Consolidating Statement of Operations | Condensed Consolidating Statement of Operations for the three months ended April 1, 2017 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated Net sales $ — $ 998.8 $ 204.7 $ — $ 1,203.5 Cost of sales — 558.4 142.7 — 701.1 Gross profit — 440.4 62.0 — 502.4 Operating expenses: Selling, general and administrative — 156.0 41.4 0.4 197.8 Impairment, restructuring and other — 3.7 (0.4 ) — 3.3 Other (income) loss, net (0.2 ) (1.1 ) 0.7 — (0.6 ) Income (loss) from operations 0.2 281.8 20.3 (0.4 ) 301.9 Equity (income) loss in subsidiaries (173.8 ) (8.3 ) — 182.1 — Other non-operating (income) loss (7.5 ) — (4.0 ) 11.5 — Equity in (income) loss of unconsolidated affiliates — 24.0 0.1 — 24.1 Interest expense 20.5 11.4 1.1 (11.5 ) 21.5 Income (loss) from continuing operations before income taxes 161.0 254.7 23.1 (182.5 ) 256.3 Income tax (benefit) expense from continuing operations (4.6 ) 87.4 8.2 — 91.0 Income (loss) from continuing operations 165.6 167.3 14.9 (182.5 ) 165.3 Income (loss) from discontinued operations, net of tax — (0.1 ) — — (0.1 ) Net income (loss) $ 165.6 $ 167.2 $ 14.9 $ (182.5 ) $ 165.2 Net (income) loss attributable to noncontrolling interest — — — (0.1 ) (0.1 ) Net income (loss) attributable to controlling interest $ 165.6 $ 167.2 $ 14.9 $ (182.6 ) $ 165.1 Condensed Consolidating Statement of Operations for the six months ended April 1, 2017 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated Net sales $ — $ 1,144.3 $ 306.0 $ — $ 1,450.3 Cost of sales — 684.8 218.9 — 903.7 Gross profit — 459.5 87.1 — 546.6 Operating expenses: Selling, general and administrative — 241.8 74.4 0.7 316.9 Impairment, restructuring and other — 5.1 (0.4 ) — 4.7 Other (income) loss, net (0.4 ) (6.4 ) 0.8 — (6.0 ) Income (loss) from operations 0.4 219.0 12.3 (0.7 ) 231.0 Equity (income) loss in subsidiaries (115.4 ) (7.0 ) — 122.4 — Other non-operating (income) loss (11.8 ) — (9.9 ) 21.7 — Equity in (income) loss of unconsolidated affiliates — 37.2 0.1 — 37.3 Interest expense 35.3 21.3 2.2 (21.7 ) 37.1 Income (loss) from continuing operations before income taxes 92.3 167.5 19.9 (123.1 ) 156.6 Income tax (benefit) expense from continuing operations (8.2 ) 56.8 7.0 — 55.6 Income (loss) from continuing operations 100.5 110.7 12.9 (123.1 ) 101.0 Income (loss) from discontinued operations, net of tax — (0.7 ) — — (0.7 ) Net income (loss) $ 100.5 $ 110.0 $ 12.9 $ (123.1 ) $ 100.3 Net (income) loss attributable to noncontrolling interest — — — (0.5 ) (0.5 ) Net income (loss) attributable to controlling interest $ 100.5 $ 110.0 $ 12.9 $ (123.6 ) $ 99.8 Condensed Consolidating Statement of Operations for the three months ended April 2, 2016 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated Net sales $ — $ 1,069.0 $ 176.2 $ — $ 1,245.2 Cost of sales — 605.2 118.3 — 723.5 Cost of sales—impairment, restructuring and other — 0.1 — — 0.1 Gross profit — 463.7 57.9 — 521.6 Operating expenses: Selling, general and administrative — 162.6 37.9 0.4 200.9 Impairment, restructuring and other — (47.5 ) 0.3 — (47.2 ) Other (income) loss, net — (0.4 ) (0.9 ) — (1.3 ) Income (loss) from operations — 349.0 20.6 (0.4 ) 369.2 Equity (income) loss in subsidiaries (216.6 ) (7.7 ) — 224.3 — Other non-operating (income) loss (8.7 ) — (6.2 ) 14.9 — Interest expense 18.2 14.6 1.2 (14.9 ) 19.1 Income (loss) from continuing operations before income taxes 207.1 342.1 25.6 (224.7 ) 350.1 Income tax (benefit) expense from continuing operations (3.4 ) 118.5 9.2 — 124.3 Income (loss) from continuing operations 210.5 223.6 16.4 (224.7 ) 225.8 Income (loss) from discontinued operations, net of tax — (16.0 ) — — (16.0 ) Net income (loss) $ 210.5 $ 207.6 $ 16.4 $ (224.7 ) $ 209.8 Net (income) loss attributable to noncontrolling interest — — — 0.3 0.3 Net income (loss) attributable to controlling interest $ 210.5 $ 207.6 $ 16.4 $ (224.4 ) $ 210.1 Condensed Consolidating Statement of Operations for the six months ended April 2, 2016 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated Net sales $ — $ 1,199.3 $ 240.4 $ — $ 1,439.7 Cost of sales — 730.0 166.3 — 896.3 Cost of sales—impairment, restructuring and other — 5.1 — — 5.1 Gross profit — 464.2 74.1 — 538.3 Operating expenses: Selling, general and administrative — 247.3 66.2 0.7 314.2 Impairment, restructuring and other — (46.2 ) 0.3 — (45.9 ) Other (income) loss, net — (1.3 ) (0.2 ) — (1.5 ) Income (loss) from operations — 264.4 7.8 (0.7 ) 271.5 Equity (income) loss in subsidiaries (149.0 ) (5.3 ) — 154.3 — Other non-operating (income) loss (13.2 ) — (12.3 ) 25.5 — Costs related to refinancing 8.8 — — — 8.8 Interest expense 34.2 24.7 2.0 (25.5 ) 35.4 Income (loss) from continuing operations before income taxes 119.2 245.0 18.1 (155.0 ) 227.3 Income tax (benefit) expense from continuing operations (10.6 ) 84.8 6.5 — 80.7 Income (loss) from continuing operations 129.8 160.2 11.6 (155.0 ) 146.6 Income (loss) from discontinued operations, net of tax — (17.5 ) — — (17.5 ) Net income (loss) $ 129.8 $ 142.7 $ 11.6 $ (155.0 ) $ 129.1 Net (income) loss attributable to noncontrolling interest — — — (0.1 ) (0.1 ) Net income (loss) attributable to controlling interest $ 129.8 $ 142.7 $ 11.6 $ (155.1 ) $ 129.0 |
Condensed Consolidating Statement of Comprehensive Income (Loss) | Condensed Consolidating Statement of Comprehensive Income (Loss) for the three months ended April 1, 2017 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated Net income (loss) $ 165.6 $ 167.2 $ 14.9 $ (182.5 ) $ 165.2 Other comprehensive income (loss), net of tax: Net foreign currency translation adjustment 1.8 — 1.8 (1.8 ) 1.8 Net change in derivatives 1.1 (0.2 ) — 0.2 1.1 Net change in pension and other post-retirement benefits 0.5 0.3 0.2 (0.5 ) 0.5 Total other comprehensive income (loss) 3.4 0.1 2.0 (2.1 ) 3.4 Comprehensive income (loss) $ 169.0 $ 167.3 $ 16.9 $ (184.6 ) $ 168.6 Condensed Consolidating Statement of Comprehensive Income (Loss) for the six months ended April 1, 2017 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated Net income (loss) $ 100.5 $ 110.0 $ 12.9 $ (123.1 ) $ 100.3 Other comprehensive income (loss), net of tax: Net foreign currency translation adjustment (2.2 ) — (2.2 ) 2.2 (2.2 ) Net change in derivatives 4.5 0.8 — (0.8 ) 4.5 Net change in pension and other post-retirement benefits 0.9 0.3 0.6 (0.9 ) 0.9 Total other comprehensive income (loss) 3.2 1.1 (1.6 ) 0.5 3.2 Comprehensive income (loss) $ 103.7 $ 111.1 $ 11.3 $ (122.6 ) $ 103.5 Condensed Consolidating Statement of Comprehensive Income (Loss) for the three months ended April 2, 2016 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated Net income (loss) $ 210.5 $ 207.6 $ 16.4 $ (224.7 ) $ 209.8 Other comprehensive income (loss), net of tax: Net foreign currency translation adjustment 0.3 — 0.3 (0.3 ) 0.3 Net change in derivatives (0.1 ) 0.3 — (0.3 ) (0.1 ) Net change in pension and other post-retirement benefits 0.2 0.1 0.1 (0.2 ) 0.2 Total other comprehensive income (loss) 0.4 0.4 0.4 (0.8 ) 0.4 Comprehensive income (loss) $ 210.9 $ 208.0 $ 16.8 $ (225.5 ) $ 210.2 Condensed Consolidating Statement of Comprehensive Income (Loss) for the six months ended April 2, 2016 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated Net income (loss) $ 129.8 $ 142.7 $ 11.6 $ (155.0 ) $ 129.1 Other comprehensive income (loss), net of tax: Net foreign currency translation adjustment (2.5 ) — (2.5 ) 2.5 (2.5 ) Net change in derivatives 2.0 (0.3 ) — 0.3 2.0 Net change in pension and other post-retirement benefits 0.7 0.4 0.3 (0.7 ) 0.7 Total other comprehensive income (loss) 0.2 0.1 (2.2 ) 2.1 0.2 Comprehensive income (loss) $ 130.0 $ 142.8 $ 9.4 $ (152.9 ) $ 129.3 |
Condensed Consolidating Statement of Cash Flows | Condensed Consolidating Statement of Cash Flows for the six months ended April 1, 2017 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES $ (17.0 ) $ (386.6 ) $ (94.2 ) $ — $ (497.8 ) INVESTING ACTIVITIES (a) Proceeds from sale of long-lived assets — 4.8 — — 4.8 Investments in property, plant and equipment — (27.8 ) (5.0 ) — (32.8 ) Distributions from (investments in) unconsolidated affiliates — — (0.2 ) — (0.2 ) Investments in acquired businesses, net of cash acquired — (1.5 ) (76.4 ) — (77.9 ) Return of investments from affiliates 351.5 32.4 — (383.9 ) — Investing cash flows from (to) affiliates (436.1 ) (276.9 ) — 713.0 — Net cash provided by (used in) investing activities (84.6 ) (269.0 ) (81.6 ) 329.1 (106.1 ) FINANCING ACTIVITIES Borrowings under revolving and bank lines of credit and term loans — 806.2 138.4 — 944.6 Repayments under revolving and bank lines of credit and term loans — (232.3 ) (162.7 ) — (395.0 ) Proceeds from issuance of 5.250% Senior Notes 250.0 — — — 250.0 Financing and issuance fees (3.8 ) (0.1 ) — — (3.9 ) Dividends paid (59.9 ) (351.5 ) — 351.5 (59.9 ) Distribution paid by AeroGrow — — (40.5 ) 32.4 (8.1 ) Purchase of Common Shares (90.4 ) — — — (90.4 ) Payments on seller notes — — (13.2 ) — (13.2 ) Excess tax benefits from share-based payment arrangements 4.0 — — — 4.0 Cash received from the exercise of stock options 1.7 — — — 1.7 Financing cash flows from (to) affiliates — 436.1 276.9 (713.0 ) — Net cash provided by (used in) financing activities 101.6 658.4 198.9 (329.1 ) 629.8 Effect of exchange rate changes on cash — — (1.7 ) — (1.7 ) Net increase (decrease) in cash and cash equivalents — 2.8 21.4 — 24.2 Cash and cash equivalents at beginning of period — 2.7 47.4 — 50.1 Cash and cash equivalents at end of period $ — $ 5.5 $ 68.8 $ — $ 74.3 (a) Cash received by the Parent from the Guarantors and Non-Guarantors in the form of dividends in the amount of $351.5 million represent return of investments and are included in cash flows from investing activities. Cash received by the Guarantors from the Non-Guarantors in the form of distributions in the amount of $32.4 million represent return of investments and are included in cash flows from investing activities. Condensed Consolidating Statement of Cash Flows for the six months ended April 2, 2016 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES (a) $ 292.6 $ (492.8 ) $ (113.8 ) $ (313.8 ) $ (627.8 ) INVESTING ACTIVITIES Proceeds from sale of long-lived assets — 0.2 — — 0.2 Investments in property, plant and equipment — (20.8 ) (3.6 ) — (24.4 ) Investments in loan receivable — (72.0 ) — — (72.0 ) Distributions from (investments in) unconsolidated affiliates — (2.0 ) — — (2.0 ) Investing cash flows from (to) affiliates (395.0 ) — — 395.0 — Net cash provided by (used in) investing activities (395.0 ) (94.6 ) (3.6 ) 395.0 (98.2 ) FINANCING ACTIVITIES Borrowings under revolving and bank lines of credit and term loans — 1,429.7 143.5 — 1,573.2 Repayments under revolving and bank lines of credit and term loans — (925.8 ) (34.0 ) — (959.8 ) Proceeds from issuance of 6.000% Senior Notes 400.0 — — — 400.0 Repayment of 6.625% Senior Notes (200.0 ) — — — (200.0 ) Financing and issuance fees (10.5 ) — — — (10.5 ) Dividends paid (57.7 ) (313.8 ) — 313.8 (57.7 ) Purchase of Common Shares (42.8 ) — — — (42.8 ) Payments on seller notes — (1.8 ) (0.5 ) — (2.3 ) Excess tax benefits from share-based payment arrangements 4.2 — — — 4.2 Cash received from the exercise of stock options 9.2 — — — 9.2 Financing cash flows from (to) affiliates — 398.5 (3.5 ) (395.0 ) — Net cash provided by (used in) financing activities 102.4 586.8 105.5 (81.2 ) 713.5 Effect of exchange rate changes on cash — — (1.6 ) — (1.6 ) Net increase (decrease) in cash and cash equivalents — (0.6 ) (13.5 ) — (14.1 ) Cash and cash equivalents at beginning of period — 8.2 63.2 — 71.4 Cash and cash equivalents at end of period $ — $ 7.6 $ 49.7 $ — $ 57.3 (a) Cash received by the Parent from its subsidiaries in the form of dividends in the amount of $313.8 million represent return on investments and are included in cash flows from operating activities. |
Condensed Consolidating Balance Sheet | Condensed Consolidating Balance Sheet As of April 1, 2017 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated ASSETS Current assets: Cash and cash equivalents $ — $ 5.5 $ 68.8 $ — $ 74.3 Accounts receivable, net — 900.8 220.5 — 1,121.3 Inventories — 500.7 157.8 — 658.5 Prepaid and other current assets 0.7 106.9 47.9 — 155.5 Total current assets 0.7 1,513.9 495.0 — 2,009.6 Investment in unconsolidated affiliates — 59.1 0.8 — 59.9 Property, plant and equipment, net — 385.8 75.1 — 460.9 Goodwill — 262.9 127.4 11.6 401.9 Intangible assets, net — 590.3 185.9 9.5 785.7 Other assets 10.7 107.8 2.3 (0.4 ) 120.4 Equity investment in subsidiaries 938.7 — — (938.7 ) — Intercompany assets 1,778.4 — — (1,778.4 ) — Total assets $ 2,728.5 $ 2,919.8 $ 886.5 $ (2,696.4 ) $ 3,838.4 LIABILITIES AND EQUITY Current liabilities: Current portion of debt $ 15.0 $ 15.8 $ 16.3 $ (15.0 ) $ 32.1 Accounts payable — 240.6 82.0 — 322.6 Other current liabilities 17.8 261.0 111.2 — 390.0 Total current liabilities 32.8 517.4 209.5 (15.0 ) 744.7 Long-term debt 2,016.1 1,288.2 126.2 (1,375.4 ) 2,055.1 Other liabilities 0.7 270.6 71.2 4.7 347.2 Equity investment in subsidiaries — 31.5 — (31.5 ) — Intercompany liabilities — 97.8 273.6 (371.4 ) — Total liabilities 2,049.6 2,205.5 680.5 (1,788.6 ) 3,147.0 Total equity—controlling interest 678.9 714.3 206.0 (920.3 ) 678.9 Noncontrolling interest — — — 12.5 12.5 Total equity 678.9 714.3 206.0 (907.8 ) 691.4 Total liabilities and equity $ 2,728.5 $ 2,919.8 $ 886.5 $ (2,696.4 ) $ 3,838.4 Condensed Consolidating Balance Sheet As of April 2, 2016 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated ASSETS Current assets: Cash and cash equivalents $ — $ 7.6 $ 49.7 $ — $ 57.3 Accounts receivable, net — 731.0 223.7 — 954.7 Accounts receivable pledged — 208.4 — — 208.4 Inventories — 483.5 136.1 — 619.6 Assets held for sale — 208.7 — — 208.7 Prepaid and other current assets — 122.1 38.0 — 160.1 Total current assets — 1,761.3 447.5 — 2,208.8 Property, plant and equipment, net — 382.3 54.0 — 436.3 Goodwill — 260.5 12.8 11.6 284.9 Intangible assets, net — 602.0 33.8 11.0 646.8 Other assets 15.6 87.2 15.0 (15.3 ) 102.5 Equity investment in subsidiaries 634.8 — — (634.8 ) — Intercompany assets 1,814.0 — — (1,814.0 ) — Total assets $ 2,464.4 $ 3,093.3 $ 563.1 $ (2,441.5 ) $ 3,679.3 LIABILITIES AND EQUITY Current liabilities: Current portion of debt $ 15.0 $ 182.9 $ 20.0 $ (15.0 ) $ 202.9 Accounts payable — 221.9 71.9 — 293.8 Liabilities held for sale — 62.1 — — 62.1 Other current liabilities 18.9 318.0 90.2 — 427.1 Total current liabilities 33.9 784.9 182.1 (15.0 ) 985.9 Long-term debt 1,750.0 1,168.8 196.0 (1,356.3 ) 1,758.5 Other liabilities 5.1 221.0 31.2 (10.3 ) 247.0 Equity investment in subsidiaries — 176.9 — (176.9 ) — Intercompany liabilities — 269.0 64.0 (333.0 ) — Total liabilities 1,789.0 2,620.6 473.3 (1,891.5 ) 2,991.4 Total equity—controlling interest 675.4 472.7 89.8 (562.5 ) 675.4 Noncontrolling interest — — — 12.5 12.5 Total equity 675.4 472.7 89.8 (550.0 ) 687.9 Total liabilities and equity $ 2,464.4 $ 3,093.3 $ 563.1 $ (2,441.5 ) $ 3,679.3 Condensed Consolidating Balance Sheet As of September 30, 2016 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated ASSETS Current assets: Cash and cash equivalents $ — $ 2.7 $ 47.4 $ — $ 50.1 Accounts receivable, net — 92.4 104.0 — 196.4 Accounts receivable pledged — 174.7 — — 174.7 Inventories — 327.8 120.4 — 448.2 Prepaid and other current assets 0.1 82.8 39.4 — 122.3 Total current assets 0.1 680.4 311.2 — 991.7 Investment in unconsolidated affiliates — 100.3 0.7 — 101.0 Property, plant and equipment, net — 392.1 78.7 — 470.8 Goodwill — 260.4 101.2 11.6 373.2 Intangible assets, net — 596.4 144.3 10.2 750.9 Other assets 13.2 103.8 0.7 (2.5 ) 115.2 Equity investment in subsidiaries 808.8 — — (808.8 ) — Intercompany assets 1,013.0 — — (1,013.0 ) — Total assets $ 1,835.1 $ 2,133.4 $ 636.8 $ (1,802.5 ) $ 2,802.8 LIABILITIES AND EQUITY Current liabilities: Current portion of debt $ 15.0 $ 154.2 $ 30.8 $ (15.0 ) $ 185.0 Accounts payable — 108.8 57.1 — 165.9 Other current liabilities 16.6 143.6 82.0 — 242.2 Total current liabilities 31.6 406.6 169.9 (15.0 ) 593.1 Long-term debt 1,085.1 575.7 117.2 (652.9 ) 1,125.1 Other liabilities 3.2 268.7 76.0 2.4 350.3 Equity investment in subsidiaries — 161.0 — (161.0 ) — Intercompany liabilities — 147.2 187.1 (334.3 ) — Total liabilities 1,119.9 1,559.2 550.2 (1,160.8 ) 2,068.5 Total equity—controlling interest 715.2 574.2 86.6 (660.8 ) 715.2 Noncontrolling interest — — — 19.1 19.1 Total equity 715.2 574.2 86.6 (641.7 ) 734.3 Total liabilities and equity $ 1,835.1 $ 2,133.4 $ 636.8 $ (1,802.5 ) $ 2,802.8 |
SUMMARY OF SIGNIFICANT ACCOUN40
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Apr. 01, 2017 | Apr. 02, 2016 | Apr. 01, 2017 | Apr. 02, 2016 | Sep. 30, 2016 | |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Second and third quarter percentage of annual net sales | 75.00% | ||||
Interest income | $ 2.1 | $ 0.4 | $ 4.8 | $ 0.4 | |
Capital expenditure unpaid liabilities incurred | 2.3 | 3.7 | |||
Prepaid and other current assets | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Deferred income tax assets, net | 61.4 | 72.4 | $ 61.4 | 72.4 | $ 62.1 |
Accounting Standards Update 2015-03 | Long-term Debt | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Debt issuance costs | 6.3 | 6.3 | 6 | ||
Accounting Standards Update 2015-03 | Other Noncurrent Assets | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Debt issuance costs | $ (6.3) | $ (6.3) | $ (6) | ||
Scotts Canada, Ltd. | Fafard & Brothers Ltd. | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Payment of contingent consideration | $ 6.7 | ||||
TruGreen Joint Venture | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Equity ownership percentage | 30.00% | 30.00% |
SUMMARY OF SIGNIFICANT ACCOUN41
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Supplemental Cash Flow Information (Details) - USD ($) $ in Millions | 6 Months Ended | ||
Apr. 01, 2017 | Apr. 02, 2016 | Dec. 15, 2015 | |
Debt Instrument [Line Items] | |||
Interest paid | $ (26.5) | $ (23) | |
Income taxes paid | (3.2) | (2.2) | |
Senior Notes - 6.625% | |||
Debt Instrument [Line Items] | |||
Call premium on 6.625% Senior Notes | $ 0 | $ (6.6) | |
Senior Notes | Senior Notes - 6.625% | |||
Debt Instrument [Line Items] | |||
Interest rate of debt | 6.625% | 6.625% |
DISCONTINUED OPERATIONS - Addi
DISCONTINUED OPERATIONS - Additional Information (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Apr. 01, 2017 | Apr. 02, 2016 | Apr. 01, 2017 | Apr. 02, 2016 | Sep. 30, 2016 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Impairment, restructuring and other | $ 3,300,000 | $ (47,200,000) | $ 4,700,000 | $ (45,900,000) | |
Project Focus | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Impairment, restructuring and other | 3,300,000 | 1,700,000 | 4,700,000 | 2,600,000 | |
Scotts Lawnservice | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Gain on contribution of SLS Business | 0 | 0 | (300,000) | 0 | |
Impairment, restructuring and other | 10,600,000 | 700,000 | 13,600,000 | ||
Cash (used in) provided by operating activities | (9,300,000) | 12,200,000 | |||
Cash used in investing activities | 0 | 100,000 | |||
Scotts Lawnservice | Project Focus | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Litigation settlement amount | 9,000,000 | 9,000,000 | |||
Impairment, restructuring and other | 100,000 | 700,000 | |||
Divestiture transaction related costs | $ 100,000 | $ 1,600,000 | $ 700,000 | $ 4,600,000 | |
TruGreen Joint Venture | |||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||
Equity ownership percentage | 30.00% | 30.00% | |||
Gain on contribution of SLS Business | $ 131,200,000 | ||||
Provision for deferred income tax on gain of contribution of SLS business | $ 51,900,000 |
DISCONTINUED OPERATIONS - Summa
DISCONTINUED OPERATIONS - Summary of Income from Discontinued Operations (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Apr. 01, 2017 | Apr. 02, 2016 | Apr. 01, 2017 | Apr. 02, 2016 | |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Impairment, restructuring and other | $ 3.3 | $ (47.2) | $ 4.7 | $ (45.9) |
Loss from discontinued operations, net of tax | (0.1) | (16) | (0.7) | (17.5) |
Scotts Lawnservice | ||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | ||||
Net sales | 0 | 40.9 | 0 | 92 |
Operating costs | 0 | 55.7 | 0 | 107.1 |
Impairment, restructuring and other | 10.6 | 0.7 | 13.6 | |
Other income, net | 0 | (0.7) | 0 | (1.5) |
Adjustment to gain on contribution of SLS Business | 0 | 0 | 0.3 | 0 |
Loss from discontinued operations before income taxes | (0.1) | (24.7) | (1) | (27.2) |
Income tax benefit from discontinued operations | 0 | (8.7) | (0.3) | (9.7) |
Loss from discontinued operations, net of tax | $ (0.1) | $ (16) | $ (0.7) | $ (17.5) |
DISCONTINUED OPERATIONS - Sum44
DISCONTINUED OPERATIONS - Summary of Assets and Liabilities of Discontinued Operations (Details) - USD ($) $ in Millions | Apr. 01, 2017 | Sep. 30, 2016 | Apr. 02, 2016 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Assets held for sale | $ 0 | $ 0 | $ 208.7 |
Liabilities held for sale | $ 0 | $ 0 | 62.1 |
Scotts Lawnservice | |||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||
Accounts receivable, net | 17.2 | ||
Inventories | 13.8 | ||
Prepaid and other assets | 13.1 | ||
Property, plant and equipment, net | 8.4 | ||
Goodwill and intangible assets, net | 156.2 | ||
Assets held for sale | 208.7 | ||
Current portion of debt | 0.3 | ||
Accounts payable | 4.5 | ||
Other current liabilities | 52.1 | ||
Long-term debt | 3.3 | ||
Other liabilities | 1.9 | ||
Liabilities held for sale | $ 62.1 |
ACQUISITIONS AND INVESTMENTS (D
ACQUISITIONS AND INVESTMENTS (Details) - USD ($) | Oct. 03, 2016 | May 26, 2016 | Apr. 01, 2017 | Dec. 31, 2016 | Jul. 02, 2016 | Apr. 02, 2016 | Apr. 01, 2017 | Apr. 02, 2016 | Sep. 30, 2016 |
ACQUISITIONS | |||||||||
Goodwill acquired | $ 401,900,000 | $ 284,900,000 | $ 401,900,000 | $ 284,900,000 | $ 373,200,000 | ||||
Investment in unconsolidated affiliates | 59,900,000 | 0 | 59,900,000 | 0 | $ 101,000,000 | ||||
American Agritech, L.L.C. | |||||||||
ACQUISITIONS | |||||||||
Aggregate purchase price | $ 92,600,000 | ||||||||
Contingent consideration for acquired business | 15,500,000 | ||||||||
Cash, prepaid, and other current assets | 1,200,000 | ||||||||
Inventory and accounts receivable | 8,400,000 | ||||||||
Fixed assets acquired | 1,400,000 | ||||||||
Accounts payable and other current liabilities acquired | 2,300,000 | ||||||||
Finite-lived intangible assets acquired | 53,000,000 | ||||||||
Goodwill acquired | $ 30,900,000 | ||||||||
Net sales | 11,300,000 | $ 21,200,000 | |||||||
American Agritech, L.L.C. | Minimum | |||||||||
ACQUISITIONS | |||||||||
Finite-lived intangible asset, useful life | 5 years | ||||||||
American Agritech, L.L.C. | Maximum | |||||||||
ACQUISITIONS | |||||||||
Finite-lived intangible asset, useful life | 25 years | ||||||||
Acquisition of Emerging Area Support Companies | |||||||||
ACQUISITIONS | |||||||||
Aggregate purchase price | $ 3,200,000 | ||||||||
Valuation of acquired assets, intangible assets and goodwill | 2,800,000 | ||||||||
Gavita Holdings B.V. | |||||||||
ACQUISITIONS | |||||||||
Aggregate purchase price | $ 136,200,000 | ||||||||
Economic interest acquired | 75.00% | ||||||||
Economic interest retained by former owner | 25.00% | ||||||||
Contingent consideration for acquired business | $ 2,500,000 | ||||||||
Cash, prepaid, and other current assets | 6,400,000 | ||||||||
Inventory and accounts receivable | 38,300,000 | ||||||||
Fixed assets acquired | 1,500,000 | ||||||||
Accounts payable and other current liabilities acquired | 18,700,000 | ||||||||
Finite-lived intangible assets acquired | 102,600,000 | ||||||||
Goodwill acquired | 82,700,000 | ||||||||
Short term debt acquired | 5,500,000 | ||||||||
Deferred tax liabilities | 25,700,000 | ||||||||
Loans payable, noncurrent | $ 37,700,000 | ||||||||
Net sales | 24,100,000 | $ 50,700,000 | |||||||
Non-controlling interest ownership percentage of outstanding shares | 5.00% | ||||||||
Gavita Holdings B.V. | Minimum | |||||||||
ACQUISITIONS | |||||||||
Finite-lived intangible asset, useful life | 5 years | ||||||||
Gavita Holdings B.V. | Maximum | |||||||||
ACQUISITIONS | |||||||||
Finite-lived intangible asset, useful life | 25 years | ||||||||
Growing Media Acquisition, Canada | |||||||||
ACQUISITIONS | |||||||||
Aggregate purchase price | $ 33,900,000 | ||||||||
Contingent consideration for acquired business | 10,800,000 | ||||||||
Payment of contingent consideration | $ 6,500,000 | ||||||||
Inventory and accounts receivable | 4,700,000 | ||||||||
Fixed assets acquired | 18,600,000 | ||||||||
Finite-lived intangible assets acquired | 11,400,000 | ||||||||
Goodwill acquired | 2,100,000 | ||||||||
Deferred tax liabilities | 1,400,000 | ||||||||
Net sales | $ 3,600,000 | $ 7,300,000 | |||||||
Investment in unconsolidated affiliates | $ 700,000 | ||||||||
Growing Media Acquisition, Canada | Minimum | |||||||||
ACQUISITIONS | |||||||||
Finite-lived intangible asset, useful life | 5 years | ||||||||
Growing Media Acquisition, Canada | Maximum | |||||||||
ACQUISITIONS | |||||||||
Finite-lived intangible asset, useful life | 25 years | ||||||||
Bonnie Plants, Inc. | |||||||||
ACQUISITIONS | |||||||||
Loans receivable, net | 72,000,000 | 72,000,000 | |||||||
Interest rate of debt | 6.95% | 6.95% | |||||||
Cost reimbursements | $ 600,000 | $ 200,000 | $ 1,600,000 | $ 200,000 | |||||
Bonnie Plants, Inc. | Unobservable Inputs (Level 3) | Fair Value, Measurements, Recurring | |||||||||
ACQUISITIONS | |||||||||
Derivative instruments not designated as hedging instruments, asset, at fair value | $ 10,900,000 | $ 10,900,000 |
INVESTMENT IN UNCONSOLIDATED 46
INVESTMENT IN UNCONSOLIDATED AFFILIATES - Additional Information (Details) - USD ($) | Apr. 13, 2016 | Apr. 01, 2017 | Apr. 02, 2016 | Apr. 01, 2017 | Apr. 02, 2016 | Sep. 30, 2016 |
Schedule of Equity Method Investments [Line Items] | ||||||
Excess distribution from affiliates | $ 0 | |||||
Accounts receivable, net | $ 1,121,300,000 | $ 954,700,000 | 1,121,300,000 | $ 954,700,000 | $ 196,400,000 | |
Equity in loss of unconsolidated affiliates | $ 24,100,000 | $ 0 | $ 37,300,000 | $ 0 | ||
TruGreen Joint Venture | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Equity ownership percentage | 30.00% | 30.00% | ||||
Estimated market value | $ 294,000,000 | |||||
Excess distribution from affiliates | 196,200,000 | |||||
Second lien term loan investment | $ 18,000,000 | |||||
Reimbursements pursuant to short-term transition services and employee leasing agreement | $ 14,700,000 | $ 33,700,000 | ||||
Accounts receivable, net | 8,300,000 | 8,300,000 | ||||
Indemnification asset | 7,400,000 | 7,400,000 | ||||
Distributions received from unconsolidated affiliates | 0 | 2,200,000 | ||||
Restructuring and other charges | 2,100,000 | 11,700,000 | ||||
Nonrecurring integration and separation costs | 0 | 7,900,000 | ||||
Fair value write-down adjustment of deferred revenue and advertising | $ 2,100,000 | $ 3,800,000 |
INVESTMENT IN UNCONSOLIDATED 47
INVESTMENT IN UNCONSOLIDATED AFFILIATES - Joint Venture Financial Information (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Apr. 01, 2017 | Apr. 02, 2016 | Apr. 01, 2017 | Apr. 02, 2016 | |
Condensed Financial Statements, Captions [Line Items] | ||||
Net sales | $ 1,203.5 | $ 1,245.2 | $ 1,450.3 | $ 1,439.7 |
Gross margin | 502.4 | 521.6 | 546.6 | 538.3 |
Interest expense | 21.5 | 19.1 | 37.1 | 35.4 |
Net income (loss) attributable to controlling interest | 165.1 | $ 210.1 | 99.8 | $ 129 |
TruGreen Joint Venture | ||||
Condensed Financial Statements, Captions [Line Items] | ||||
Net sales | 154.7 | 406.8 | ||
Gross margin | 9.7 | 70.8 | ||
Depreciation and amortization | 36.6 | 56.8 | ||
Interest expense | 16.6 | 33.5 | ||
Selling, general, administrative and other | 36.6 | 78 | ||
Restructuring and other charges | 0 | 26.6 | ||
Net income (loss) attributable to controlling interest | $ (80.1) | $ (124.1) |
IMPAIRMENT, RESTRUCTURING AND48
IMPAIRMENT, RESTRUCTURING AND OTHER - Impairment, Restructuring and Other Charges (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Apr. 01, 2017 | Apr. 02, 2016 | Apr. 01, 2017 | Apr. 02, 2016 | |
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and other charges (recoveries) | $ 3.3 | $ (47.2) | $ 4.7 | $ (45.9) |
Impairment, restructuring and other charges (recoveries) from continuing operations | 3.3 | (47.1) | 4.7 | (40.8) |
Total impairment, restructuring and other charges (recoveries) | 3.4 | (36.5) | 5.4 | (27.2) |
Scotts Lawnservice | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and other charges (recoveries) | 10.6 | 0.7 | 13.6 | |
Cost of sales | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and other charges (recoveries) | 0 | 0.1 | 0 | 5.1 |
Operating Expense | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and other charges (recoveries) | $ 3.3 | $ (47.2) | $ 4.7 | $ (45.9) |
IMPAIRMENT, RESTRUCTURING AND49
IMPAIRMENT, RESTRUCTURING AND OTHER - Activity Related to Liabilities Associated with Restructuring (Details) $ in Millions | 6 Months Ended |
Apr. 01, 2017USD ($) | |
Restructuring Reserve [Roll Forward] | |
Amounts reserved for restructuring and other, beginning balance | $ 20.8 |
Restructuring and other charges from continuing operations | 4.7 |
Restructuring and other charges from discontinued operations | 0.7 |
Payments and other | (20) |
Amounts reserved for restructuring and other, ending balance | $ 6.2 |
IMPAIRMENT, RESTRUCTURING AND50
IMPAIRMENT, RESTRUCTURING AND OTHER - Additional Information (Details) - USD ($) | 3 Months Ended | 6 Months Ended | 18 Months Ended | |||
Apr. 01, 2017 | Apr. 02, 2016 | Apr. 01, 2017 | Apr. 02, 2016 | Apr. 01, 2017 | Sep. 30, 2016 | |
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring reserve, long term | $ 1,300,000 | $ 1,300,000 | $ 1,300,000 | |||
Impairment, restructuring and other | 3,300,000 | $ (47,200,000) | 4,700,000 | $ (45,900,000) | ||
Restructuring and other charges from discontinued operations | 700,000 | |||||
Restructuring and other charges from continuing operations | 4,700,000 | |||||
Impairment, restructuring and other (recoveries) charges | 3,400,000 | (36,500,000) | 5,400,000 | (27,200,000) | ||
U.S. Consumer | Bonus S | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Restructuring and other charges from continuing operations | $ 73,800,000 | |||||
Impairment, restructuring and other (recoveries) charges | 0 | 1,000,000 | 0 | 6,400,000 | ||
Reimbursement payments | $ 60,800,000 | |||||
Insurance recoveries | 50,000,000 | |||||
Project Focus | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Impairment, restructuring and other | 3,300,000 | 1,700,000 | 4,700,000 | 2,600,000 | ||
Project Focus | Other Restructuring | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Impairment, restructuring and other | 9,300,000 | |||||
Project Focus | U.S. Consumer | One-time Termination Benefits | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Impairment, restructuring and other | 3,400,000 | |||||
Project Focus | Europe Consumer | One-time Termination Benefits | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Impairment, restructuring and other | $ 2,000,000 | |||||
Scotts Lawnservice | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Impairment, restructuring and other | 10,600,000 | 700,000 | 13,600,000 | |||
Scotts Lawnservice | Project Focus | ||||||
Restructuring Cost and Reserve [Line Items] | ||||||
Impairment, restructuring and other | 100,000 | 700,000 | ||||
Divestiture transaction related costs | $ 100,000 | $ 1,600,000 | $ 700,000 | $ 4,600,000 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Millions | Apr. 01, 2017 | Sep. 30, 2016 | Apr. 02, 2016 |
Inventory Disclosure [Abstract] | |||
Finished goods | $ 439 | $ 248.7 | $ 419.2 |
Work-in-process | 58.2 | 56.9 | 50.4 |
Raw materials | 161.3 | 142.6 | 150 |
Total inventories | 658.5 | 448.2 | 619.6 |
Adjustments to reflect inventories at net realizable values | $ 11.3 | $ 10.8 | $ 21.2 |
MARKETING AGREEMENT - Additiona
MARKETING AGREEMENT - Additional Information (Details) $ in Millions | Aug. 14, 2015USD ($) | May 15, 2015USD ($) | Apr. 01, 2017USD ($) | Sep. 30, 1998USD ($) |
Monsanto Marketing Agreement | ||||
Marketing Agreement [Line Items] | ||||
Annual contribution payment | $ 20 | |||
Initial consideration for marketing rights | $ 32 | |||
Useful life of Marketing Agreement | 20 years | |||
Remaining unamortized amount | $ 1.2 | |||
Remaining amortization period of Marketing Agreement | 2 years | |||
Minimum termination fee payable | $ 200 | |||
Minimum termination fee payable multiple | 4 | |||
Commission threshold | $ 40 | |||
Percentage of program earnings | 50.00% | |||
Consideration paid | $ 300 | |||
Brand Extension Agreement | ||||
Marketing Agreement [Line Items] | ||||
Initial term | 20 years | |||
Renewal term | 20 years | |||
Allocated fair value | $ 111.7 | |||
Agency Agreement | ||||
Marketing Agreement [Line Items] | ||||
Allocated fair value | $ 188.3 | |||
Commercialization and Technology Agreement | ||||
Marketing Agreement [Line Items] | ||||
Initial term | 30 years |
MARKETING AGREEMENT - Net Commi
MARKETING AGREEMENT - Net Commission Earned Under Marketing Agreement (Details) - Monsanto Marketing Agreement - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Apr. 01, 2017 | Apr. 02, 2016 | Apr. 01, 2017 | Apr. 02, 2016 | |
Marketing Agreement [Line Items] | ||||
Gross commission | $ 46.8 | $ 54.9 | $ 48.2 | $ 54.9 |
Contribution expenses | (5) | (5) | (10) | (10) |
Amortization of marketing fee | (0.2) | (0.2) | (0.4) | (0.4) |
Net commission | 41.6 | 49.7 | 37.8 | 44.5 |
Reimbursements associated with Marketing Agreement | 21.7 | 22.8 | 38.3 | 36.8 |
Total net sales associated with Marketing Agreement | $ 63.3 | $ 72.5 | $ 76.1 | $ 81.3 |
DEBT - Components of Long-Term
DEBT - Components of Long-Term Debt (Details) - USD ($) $ in Millions | Apr. 01, 2017 | Sep. 30, 2016 | Apr. 02, 2016 |
Debt Instrument [Line Items] | |||
Total debt | $ 2,096.4 | $ 1,316.1 | $ 1,967.7 |
Less current portions | 32.1 | 185 | 202.9 |
Less unamortized debt issuance costs | 9.2 | 6 | 6.3 |
Long-term debt | 2,055.1 | 1,125.1 | 1,758.5 |
Credit Facilities | Revolving loans | |||
Debt Instrument [Line Items] | |||
Total debt | 1,109 | 417.4 | 1,075 |
Credit Facilities | Term loans | |||
Debt Instrument [Line Items] | |||
Total debt | $ 281.3 | 288.8 | 296.3 |
Senior Notes | Senior Notes – 5.250% | |||
Debt Instrument [Line Items] | |||
Interest rate of debt | 5.25% | ||
Total debt | $ 250 | 0 | $ 0 |
Senior Notes | Senior Notes – 6.000% | |||
Debt Instrument [Line Items] | |||
Interest rate of debt | 6.00% | 6.00% | |
Total debt | $ 400 | 400 | $ 400 |
Master Accounts Receivable Purchase Agreement | |||
Debt Instrument [Line Items] | |||
Total debt | 0 | 138.6 | 166.7 |
Other | |||
Debt Instrument [Line Items] | |||
Total debt | $ 56.1 | $ 71.3 | $ 29.7 |
DEBT - Additional Information (
DEBT - Additional Information (Details) | Apr. 07, 2017USD ($) | Dec. 15, 2015USD ($) | Oct. 13, 2015USD ($) | Dec. 20, 2013USD ($) | Apr. 01, 2017USD ($) | Dec. 15, 2016USD ($) | Oct. 14, 2016USD ($) | Sep. 30, 2016USD ($) | Apr. 02, 2016USD ($) | Oct. 29, 2015USD ($) | Sep. 25, 2015USD ($) |
Debt Instrument [Line Items] | |||||||||||
Senior secured credit facilities, maximum borrowing capacity | $ 1,900,000,000 | ||||||||||
Weighted average interest rate | 4.30% | 4.60% | |||||||||
Leverage ratio | 3.20 | ||||||||||
Interest coverage ratio | 7.81 | ||||||||||
Leverage ratio, restricted payment threshold | 4 | ||||||||||
Unamortized debt issuance costs | $ 9,200,000 | $ 6,000,000 | $ 6,300,000 | ||||||||
Accounts receivable pledged | 0 | 174,700,000 | 208,400,000 | ||||||||
Gavita Holdings B.V. | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Fair value of debt | 37,200,000 | $ 38,300,000 | |||||||||
Master Accounts Receivable Purchase Agreement | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Maximum aggregate amount | $ 400,000,000 | ||||||||||
Receivables facility borrowings | $ 133,500,000 | $ 166,700,000 | |||||||||
Receivables Facility | Subsequent Event | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Maximum aggregate amount | $ 250,000,000 | ||||||||||
Committed up to limit under agreement | $ 100,000,000 | ||||||||||
Receivables Facility | Base Rate | Subsequent Event | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Bearable interest rate | 0.00% | ||||||||||
Receivables Facility | LIBOR | Subsequent Event | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Bearable interest rate | 0.90% | ||||||||||
Beginning Fiscal Year 2016 | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Maximum restrictive payments | 175,000,000 | ||||||||||
Beginning Fiscal Year 2018 | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Maximum restrictive payments | $ 200,000,000 | ||||||||||
Maximum | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Leverage ratio | 4.5 | ||||||||||
Minimum | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Interest coverage ratio | 3 | ||||||||||
Revolving Credit Facility | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Weighted average interest rate | 3.70% | ||||||||||
Revolving Credit Facility | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Senior secured credit facilities, maximum borrowing capacity | 1,600,000,000 | ||||||||||
Additional maximum borrowing capacity | 500,000,000 | ||||||||||
Secured Term Loan | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Senior secured credit facilities, maximum borrowing capacity | 300,000,000 | ||||||||||
Credit Facilities | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Senior secured credit facilities, available borrowing capacity | $ 500,000,000 | ||||||||||
Credit Facilities | Letter of Credit | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Principal amount | $ 23,800,000 | ||||||||||
Credit Facilities | Third Amended and Restated Senior Secured Credit Agreement | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt maturity period | 5 years | ||||||||||
Senior secured credit facilities, maximum borrowing capacity | $ 1,700,000,000 | ||||||||||
Credit Facilities | Fourth Amended and Restated Senior Secured Credit Agreement | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Debt maturity period | 5 years | ||||||||||
Letter of Credit | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Additional maximum borrowing capacity | $ 100,000,000 | ||||||||||
Senior Notes | Senior Notes – 5.250% | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Aggregate principal amount | $ 250,000,000 | ||||||||||
Interest rate of debt | 5.25% | ||||||||||
Senior Notes | Senior Notes – 5.250% | Estimate of Fair Value Measurement | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Fair value of debt | $ 252,800,000 | ||||||||||
Senior Notes | Senior Notes - 6.625% | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Interest rate of debt | 6.625% | 6.625% | |||||||||
Repurchased debt amount | $ 200,000,000 | ||||||||||
Senior notes redemption price | 213,200,000 | ||||||||||
Accrued and unpaid interest | 6,600,000 | ||||||||||
Call premium | 6,600,000 | ||||||||||
Unamortized debt issuance costs | $ 2,200,000 | ||||||||||
Senior Notes | Senior Notes – 6.000% | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Interest rate of debt | 6.00% | 6.00% | |||||||||
Aggregate principal amount | $ 400,000,000 | ||||||||||
Senior Notes | Senior Notes – 6.000% | Estimate of Fair Value Measurement | |||||||||||
Debt Instrument [Line Items] | |||||||||||
Fair value of debt | $ 425,000,000 |
DEBT - Interest Rate Swap Agree
DEBT - Interest Rate Swap Agreements (Details) - USD ($) $ in Millions | Apr. 01, 2017 | Sep. 30, 2016 | Apr. 02, 2016 |
Instrument 1 | |||
Derivative [Line Items] | |||
Notional Amount | $ 50 | ||
Fixed Rate | 2.96% | ||
Instrument 2 | |||
Derivative [Line Items] | |||
Notional Amount | $ 200 | ||
Fixed Rate | 1.28% | ||
Instrument 3 | |||
Derivative [Line Items] | |||
Notional Amount | $ 300 | ||
Fixed Rate | 0.83% | ||
Instrument 4 | |||
Derivative [Line Items] | |||
Notional Amount | $ 200 | ||
Fixed Rate | 0.84% | ||
Instrument 5 | |||
Derivative [Line Items] | |||
Notional Amount | $ 150 | ||
Fixed Rate | 2.12% | ||
Instrument 6 | |||
Derivative [Line Items] | |||
Notional Amount | $ 50 | ||
Fixed Rate | 2.25% | ||
Instrument 7 | |||
Derivative [Line Items] | |||
Notional Amount | $ 200 | ||
Fixed Rate | 2.12% | ||
Derivatives designated as hedging instruments | Interest Rate Swap | |||
Derivative [Line Items] | |||
Notional Amount | $ 1,150 | $ 650 | $ 1,250 |
RETIREMENT AND RETIREE MEDICA57
RETIREMENT AND RETIREE MEDICAL PLANS (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Apr. 01, 2017 | Apr. 02, 2016 | Apr. 01, 2017 | Apr. 02, 2016 | |
U.S. Pension | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | $ 0 | $ 0 | $ 0 | $ 0 |
Interest cost | 0.7 | 1.1 | 1.4 | 2.2 |
Expected return on plan assets | (1.2) | (1.3) | (2.4) | (2.5) |
Net amortization | 0.4 | 0.5 | 0.8 | 0.9 |
Net periodic benefit (income) cost | (0.1) | 0.3 | (0.2) | 0.6 |
International Pension | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 0.3 | 0.3 | 0.6 | 0.6 |
Interest cost | 0.9 | 1.7 | 1.9 | 3.4 |
Expected return on plan assets | (2) | (2) | (4) | (4) |
Net amortization | 0.6 | 0.4 | 1.1 | 0.8 |
Net periodic benefit (income) cost | (0.2) | 0.4 | (0.4) | 0.8 |
U.S. Medical | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 0.1 | 0.1 | 0.2 | 0.2 |
Interest cost | 0.1 | 0.2 | 0.3 | 0.5 |
Expected return on plan assets | 0 | 0 | 0 | 0 |
Net amortization | (0.2) | (0.2) | (0.4) | (0.5) |
Net periodic benefit (income) cost | $ 0 | $ 0.1 | $ 0.1 | $ 0.2 |
EQUITY - Additional Information
EQUITY - Additional Information (Details) - USD ($) shares in Millions | 3 Months Ended | 6 Months Ended | 32 Months Ended | ||
Apr. 01, 2017 | Apr. 01, 2017 | Apr. 01, 2017 | Aug. 03, 2016 | Aug. 31, 2014 | |
Equity [Abstract] | |||||
Authorized repurchase amount | $ 1,000,000,000 | $ 500,000,000 | |||
Share repurchase period | 5 years | ||||
Increase in authorized repurchase amount | $ 500,000,000 | ||||
Common shares repurchased (shares) | 0.5 | 1 | 3.1 | ||
Common shares repurchased | $ 47,200,000 | $ 90,600,000 | $ 236,200,000 |
EQUITY - Summary of the Changes
EQUITY - Summary of the Changes in Equity (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Apr. 01, 2017 | Apr. 02, 2016 | Apr. 01, 2017 | Apr. 02, 2016 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Equity, controlling interest, beginning balance | $ 715.2 | |||
Noncontrolling interest, beginning balance | 19.1 | |||
Total equity, beginning balance | 734.3 | $ 633.1 | ||
Net income (loss), controlling interest | $ 165.1 | $ 210.1 | 99.8 | 129 |
Net income (loss) attributable to noncontrolling interest | 0.1 | (0.3) | 0.5 | 0.1 |
Net income (loss) | 165.2 | 209.8 | 100.3 | 129.1 |
Other comprehensive income | 3.4 | 0.4 | 3.2 | 0.2 |
Share-based compensation | 19.1 | 15.5 | ||
Dividends declared ($1.000 and $0.940 per share), April 1, 2017 and April 2, 2016, respectively | (60.6) | (56.8) | ||
Treasury share purchases | (90.6) | (42.8) | ||
Treasury share issuances | (6.2) | 9.6 | ||
Adjustment to noncontrolling interest due to ownership change | 0 | |||
Distribution declared by AeroGrow | (8.1) | |||
Equity, controlling interest, ending balance | 678.9 | 675.4 | 678.9 | 675.4 |
Noncontrolling interest, ending balance | 12.5 | 12.5 | 12.5 | 12.5 |
Total equity, ending balance | 691.4 | 687.9 | 691.4 | 687.9 |
Common Shares and Capital in Excess of Stated Value | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Equity, controlling interest, beginning balance | 401.7 | 400.4 | ||
Share-based compensation | 19.1 | 15.5 | ||
Treasury share issuances | (20) | (14) | ||
Adjustment to noncontrolling interest due to ownership change | (1) | |||
Equity, controlling interest, ending balance | 399.8 | 401.9 | 399.8 | 401.9 |
Retained Earnings | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Equity, controlling interest, beginning balance | 881.8 | 684.2 | ||
Net income (loss), controlling interest | 99.8 | 129 | ||
Dividends declared ($1.000 and $0.940 per share), April 1, 2017 and April 2, 2016, respectively | (60.6) | (56.8) | ||
Equity, controlling interest, ending balance | 921 | 756.4 | 921 | 756.4 |
Treasury Shares | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Equity, controlling interest, beginning balance | (451.4) | (357.1) | ||
Treasury share purchases | (90.6) | (42.8) | ||
Treasury share issuances | 13.8 | 23.6 | ||
Equity, controlling interest, ending balance | (528.2) | (376.3) | (528.2) | (376.3) |
Accumulated Other Comprehensive Loss | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Equity, controlling interest, beginning balance | (116.9) | (106.8) | ||
Other comprehensive income | 3.2 | 0.2 | ||
Equity, controlling interest, ending balance | (113.7) | (106.6) | (113.7) | (106.6) |
Total Equity - Controlling Interest | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Equity, controlling interest, beginning balance | 715.2 | 620.7 | ||
Net income (loss), controlling interest | 99.8 | 129 | ||
Other comprehensive income | 3.2 | 0.2 | ||
Share-based compensation | 19.1 | 15.5 | ||
Dividends declared ($1.000 and $0.940 per share), April 1, 2017 and April 2, 2016, respectively | (60.6) | (56.8) | ||
Treasury share purchases | (90.6) | (42.8) | ||
Treasury share issuances | (6.2) | 9.6 | ||
Adjustment to noncontrolling interest due to ownership change | (1) | |||
Equity, controlling interest, ending balance | 678.9 | 675.4 | 678.9 | 675.4 |
Non-controlling Interest | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Noncontrolling interest, beginning balance | 19.1 | 12.4 | ||
Net income (loss) attributable to noncontrolling interest | 0.5 | 0.1 | ||
Adjustment to noncontrolling interest due to ownership change | 1 | |||
Distribution declared by AeroGrow | (8.1) | |||
Noncontrolling interest, ending balance | $ 12.5 | $ 12.5 | $ 12.5 | $ 12.5 |
EQUITY - Narrative of Changes i
EQUITY - Narrative of Changes in Equity Components (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | Jan. 03, 2017 | Nov. 29, 2016 | Apr. 01, 2017 | Apr. 02, 2016 | Apr. 01, 2017 | Apr. 02, 2016 |
Schedule of Equity Method Investments [Line Items] | ||||||
Dividends declared per common share (USD per share) | $ 0.5 | $ 0.47 | $ 1 | $ 0.94 | ||
Distribution declared by AeroGrow | $ 8.1 | |||||
AeroGrow International, Inc. | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Equity ownership percentage | 45.00% | |||||
Controlling ownership percentage | 80.00% | |||||
Dividends payable | $ 41 | |||||
Dividends declared per common share (USD per share) | $ 1.21 | |||||
SMG Growing Media | AeroGrow International, Inc. | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Aggregate warrant exercise price | $ 47.8 | |||||
Number of shares issued to subsidiary upon exercise (shares) | 21.6 | |||||
Non-controlling Interest | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Distribution declared by AeroGrow | $ 8.1 | |||||
Non-controlling Interest | AeroGrow International, Inc. | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Distribution declared by AeroGrow | $ 8.1 |
EQUITY - Share-based Awards Gra
EQUITY - Share-based Awards Granted (Details) - USD ($) $ in Millions | 6 Months Ended | |
Apr. 01, 2017 | Apr. 02, 2016 | |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total share-based awards (shares) | 612,719 | 598,359 |
Aggregate fair value at grant dates (in millions) | $ 56.9 | $ 16 |
Stock options | Employees | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total share-based awards (shares) | 0 | 444,890 |
Restricted stock units | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total share-based awards (shares) | 125,045 | |
Restricted stock units | Employees | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total share-based awards (shares) | 102,143 | 70,594 |
Performance units | Employees | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total share-based awards (shares) | 487,674 | 56,315 |
Deferred stock units | Board of Directors | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||
Total share-based awards (shares) | 22,902 | 26,560 |
EQUITY - Total Share-based Comp
EQUITY - Total Share-based Compensation (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Apr. 01, 2017 | Apr. 02, 2016 | Apr. 01, 2017 | Apr. 02, 2016 | |
Equity [Abstract] | ||||
Share-based compensation | $ 12.8 | $ 9.1 | $ 15.1 | $ 11.3 |
Tax benefit recognized | 4.9 | $ 3.5 | 5.8 | $ 4.3 |
Total unrecognized compensation cost related to non-vested share-based awards | $ 52.1 | $ 52.1 | ||
Expected weighted average period for unrecognized compensation cost | 4 years | |||
Tax benefit realized from tax deduction associated with exercise of stock option | $ 4 |
EQUITY - Schedule of Aggregate
EQUITY - Schedule of Aggregate Stock Option Activity (Details) - Options $ / shares in Units, $ in Millions | 6 Months Ended |
Apr. 01, 2017USD ($)$ / sharesshares | |
No. of Options | |
Beginning balance (shares) | shares | 1,801,041 |
Exercised (shares) | shares | (38,757) |
Forfeited (shares) | shares | (9,587) |
Ending balance (shares) | shares | 1,752,697 |
Exercisable (shares) | shares | 928,489 |
Wtd. Avg. Exercise Price | |
Beginning balance (USD per share) | $ / shares | $ 51.38 |
Exercised (USD per share) | $ / shares | 42.95 |
Forfeited (USD per share) | $ / shares | 62.86 |
Ending balance (USD per share) | $ / shares | 51.44 |
Exercisable (USD per share) | $ / shares | $ 38.30 |
Intrinsic value of stock options exercised | $ | $ 1.9 |
Remaining unexercisable stock options expected to vest (in shares) | shares | 800,000 |
Weighted average exercise price of remaining unexercisable stock options expected to vest (USD per share) | $ / shares | $ 66.13 |
Intrinsic value of remaining unexercisable stock options expected to vest | $ | $ 21.1 |
Average remaining term of remaining unexercisable stock options expected to vest in the future | 8 years 109 days |
EQUITY - Summary of Certain Inf
EQUITY - Summary of Certain Information Pertaining to Stock Option Awards Outstanding and Exercisable (Details) - Options - $ / shares | 6 Months Ended | |
Apr. 01, 2017 | Sep. 30, 2016 | |
Awards Outstanding | ||
No. of Options (shares) | 1,752,697 | 1,801,041 |
Wtd. Avg. Remaining Life | 5 years 5 months | |
WTD. Avg. Exercise Price (USD per share) | $ 51.44 | $ 51.38 |
Awards Exercisable | ||
No. of Options (shares) | 928,489 | |
Wtd. Avg. Remaining Life | 2 years 9 months 21 days | |
WTD. Avg. Exercise Price (USD per share) | $ 38.30 | |
$20.59 - $20.59 | ||
Range of Exercise Price | ||
Exercise Price, minimum (USD per share) | 20.59 | |
Exercise Price, maximum (USD per share) | $ 20.59 | |
Awards Outstanding | ||
No. of Options (shares) | 210,386 | |
Wtd. Avg. Remaining Life | 1 year 186 days | |
WTD. Avg. Exercise Price (USD per share) | $ 20.59 | |
Awards Exercisable | ||
No. of Options (shares) | 210,386 | |
Wtd. Avg. Remaining Life | 1 year 186 days | |
WTD. Avg. Exercise Price (USD per share) | $ 20.59 | |
$36.37 - $36.86 | ||
Range of Exercise Price | ||
Exercise Price, minimum (USD per share) | 36.37 | |
Exercise Price, maximum (USD per share) | $ 36.86 | |
Awards Outstanding | ||
No. of Options (shares) | 157,940 | |
Wtd. Avg. Remaining Life | 219 days | |
WTD. Avg. Exercise Price (USD per share) | $ 36.44 | |
Awards Exercisable | ||
No. of Options (shares) | 157,940 | |
Wtd. Avg. Remaining Life | 219 days | |
WTD. Avg. Exercise Price (USD per share) | $ 36.44 | |
$38.81 - $49.19 | ||
Range of Exercise Price | ||
Exercise Price, minimum (USD per share) | 38.81 | |
Exercise Price, maximum (USD per share) | $ 49.19 | |
Awards Outstanding | ||
No. of Options (shares) | 557,647 | |
Wtd. Avg. Remaining Life | 3 years 10 months 29 days | |
WTD. Avg. Exercise Price (USD per share) | $ 45.39 | |
Awards Exercisable | ||
No. of Options (shares) | 557,647 | |
Wtd. Avg. Remaining Life | 3 years 10 months 29 days | |
WTD. Avg. Exercise Price (USD per share) | $ 45.39 | |
$63.43 - $68.68 | ||
Range of Exercise Price | ||
Exercise Price, minimum (USD per share) | 63.43 | |
Exercise Price, maximum (USD per share) | $ 68.68 | |
Awards Outstanding | ||
No. of Options (shares) | 826,724 | |
Wtd. Avg. Remaining Life | 8 years 4 months 7 days | |
WTD. Avg. Exercise Price (USD per share) | $ 66.23 | |
Awards Exercisable | ||
No. of Options (shares) | 2,516 | |
Wtd. Avg. Remaining Life | 7 years 9 months 29 days | |
WTD. Avg. Exercise Price (USD per share) | $ 63.43 |
EQUITY - Schedule of Intrinsic
EQUITY - Schedule of Intrinsic Value of Stock Option Awards Outstanding and Exercisable (Details) - Options $ in Millions | Apr. 01, 2017USD ($) |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Outstanding | $ 73.5 |
Exercisable | $ 51.2 |
EQUITY - Schedule of Restricted
EQUITY - Schedule of Restricted Share-Based Award Activity (Details) - $ / shares | 6 Months Ended | |
Apr. 01, 2017 | Apr. 02, 2016 | |
No. of Shares | ||
Granted (shares) | 612,719 | 598,359 |
Restricted Stock Units (RSUs) | ||
No. of Shares | ||
Beginning Balance (shares) | 305,663 | |
Granted (shares) | 125,045 | |
Vested (shares) | (131,357) | |
Forfeited (shares) | (2,010) | |
Ending Balance (shares) | 297,341 | |
Wtd. Avg. Grant Date Fair Value per Share | ||
Beginning Balance (USD per share) | $ 66.31 | |
Granted (USD per share) | 92.66 | |
Vested (USD per share) | 60.68 | |
Forfeited (USD per share) | 67.24 | |
Ending Balance (USD per share) | $ 79.88 |
EQUITY - Schedule of Performanc
EQUITY - Schedule of Performance-Based Award Activity (Details) - $ / shares | Jan. 30, 2017 | Apr. 01, 2017 | Apr. 02, 2016 |
No. of Units | |||
Granted (shares) | 612,719 | 598,359 | |
Performance Based Units | |||
No. of Units | |||
Beginning Balance (shares) | 266,598 | ||
Granted (shares) | 487,674 | ||
Vested (shares) | (147,698) | ||
Forfeited (shares) | (8,941) | ||
Ending Balance (shares) | 597,633 | ||
Wtd. Avg. Grant Date Fair Value per Unit | |||
Beginning Balance (USD per share) | $ 62.52 | ||
Granted (USD per share) | 92.95 | ||
Vested (USD per share) | 59.82 | ||
Forfeited (USD per share) | 62.81 | ||
Ending Balance (USD per share) | $ 88.01 | ||
Performance Based Units | Project Focus | Senior Executives | |||
No. of Units | |||
Granted (shares) | 465,461 |
INCOME TAXES (Details)
INCOME TAXES (Details) | 6 Months Ended | |
Apr. 01, 2017 | Apr. 02, 2016 | |
Income Tax Disclosure [Abstract] | ||
Effective tax rate related to continuing operations | 35.50% | 35.50% |
CONTINGENCIES (Details)
CONTINGENCIES (Details) $ in Millions | Apr. 01, 2017USD ($)class_action |
Loss Contingencies [Line Items] | |
Accrual for environmental actions | $ | $ 5.1 |
Wild Bird Food | |
Loss Contingencies [Line Items] | |
Number of pending claims | class_action | 4 |
DERIVATIVE INSTRUMENTS AND HE70
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Additional Information (Details) - USD ($) $ in Millions | Apr. 01, 2017 | Sep. 30, 2016 | Apr. 02, 2016 |
Not Designated as Hedging Instrument | Currency forward contracts | |||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Notional amount | $ 288.4 | $ 165.8 | $ 54.3 |
Fair value of forward contracts | (3.5) | 0.4 | (0.2) |
Derivatives designated as hedging instruments | Interest Rate Swap | |||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Notional amount | 1,150 | $ 650 | $ 1,250 |
Loss related to interest rate swap agreements expected to be reclassified | 0.5 | ||
Derivatives designated as hedging instruments | Commodity hedging instruments | |||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Loss related to Urea derivatives expected to be reclassified | $ 0.1 |
DERIVATIVE INSTRUMENTS AND HE71
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Outstanding Commodity Contracts (Details) gal in Thousands | Apr. 01, 2017tonsgal | Sep. 30, 2016tonsgal | Apr. 02, 2016tonsgal |
Urea (in tons) | |||
Derivative [Line Items] | |||
Outstanding commodity contracts | tons | 28,500 | 40,500 | 21,000 |
Diesel (in gallons) | |||
Derivative [Line Items] | |||
Outstanding commodity contracts | 5,544 | 6,384 | 5,922 |
Heating Oil (in gallons) | |||
Derivative [Line Items] | |||
Outstanding commodity contracts | 1,680 | 1,722 | 1,974 |
DERIVATIVE INSTRUMENTS AND HE72
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Fair Values of Derivative Instruments (Details) - USD ($) $ in Millions | Apr. 01, 2017 | Sep. 30, 2016 | Apr. 02, 2016 |
Derivatives, Fair Value [Line Items] | |||
Total derivatives | $ (4.9) | $ (6.4) | $ (15.6) |
Derivatives designated as hedging instruments | |||
Derivatives, Fair Value [Line Items] | |||
Total derivatives | (1.3) | (6.7) | (11.6) |
Derivatives designated as hedging instruments | Interest rate swap agreements | Prepaid and other current assets | |||
Derivatives, Fair Value [Line Items] | |||
Derivative asset | 0.7 | 0 | 0 |
Derivatives designated as hedging instruments | Interest rate swap agreements | Other assets | |||
Derivatives, Fair Value [Line Items] | |||
Derivative asset | 0.8 | 0 | 0 |
Derivatives designated as hedging instruments | Interest rate swap agreements | Other current liabilities | |||
Derivatives, Fair Value [Line Items] | |||
Derivative liability | (1.9) | (3.3) | (5.8) |
Derivatives designated as hedging instruments | Interest rate swap agreements | Other liabilities | |||
Derivatives, Fair Value [Line Items] | |||
Derivative liability | (0.7) | (3.1) | (5.1) |
Derivatives designated as hedging instruments | Commodity hedging instruments | Other current liabilities | |||
Derivatives, Fair Value [Line Items] | |||
Derivative liability | (0.2) | (0.3) | (0.7) |
Not Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Total derivatives | (3.6) | 0.3 | (4) |
Not Designated as Hedging Instrument | Currency forward contracts | Prepaid and other current assets | |||
Derivatives, Fair Value [Line Items] | |||
Derivative asset | 0.5 | 1.2 | 0 |
Not Designated as Hedging Instrument | Currency forward contracts | Other current liabilities | |||
Derivatives, Fair Value [Line Items] | |||
Derivative liability | (4) | (0.8) | (0.2) |
Not Designated as Hedging Instrument | Commodity hedging instruments | Other current liabilities | |||
Derivatives, Fair Value [Line Items] | |||
Derivative liability | $ (0.1) | $ (0.1) | $ (3.8) |
DERIVATIVE INSTRUMENTS AND HE73
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Effect of Derivative Instruments on AOCI and Statements of Operations (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Apr. 01, 2017 | Apr. 02, 2016 | Apr. 01, 2017 | Apr. 02, 2016 | |
Not Designated as Hedging Instrument | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain / (Loss) Recognized in Earnings | $ (3.1) | $ (1.3) | $ 7 | $ (5.4) |
Not Designated as Hedging Instrument | Currency forward contracts | Other income, net | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain / (Loss) Recognized in Earnings | (2.2) | (0.3) | 7 | (1.1) |
Not Designated as Hedging Instrument | Commodity hedging instruments | Cost of sales | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain / (Loss) Recognized in Earnings | (0.9) | (1) | 0 | (4.3) |
Cash Flow Hedging | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain / (Loss) Recognized in AOCI | 0 | (2.9) | 3 | (1.6) |
Amount of Gain / (Loss) Reclassified From AOCI Into Earnings | (1.1) | (2.8) | (1.5) | (3.6) |
Cash Flow Hedging | Interest rate swap agreements | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain / (Loss) Recognized in AOCI | 0.4 | (2.6) | 2.5 | (0.9) |
Cash Flow Hedging | Interest rate swap agreements | Interest expense | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain / (Loss) Reclassified From AOCI Into Earnings | (0.9) | (2.2) | (1.2) | (3.2) |
Cash Flow Hedging | Commodity hedging instruments | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain / (Loss) Recognized in AOCI | (0.4) | (0.3) | 0.5 | (0.7) |
Cash Flow Hedging | Commodity hedging instruments | Cost of sales | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain / (Loss) Reclassified From AOCI Into Earnings | $ (0.2) | $ (0.6) | $ (0.3) | $ (0.4) |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details) - Fair Value, Measurements, Recurring - USD ($) $ in Millions | Apr. 01, 2017 | Sep. 30, 2016 | Apr. 02, 2016 |
Assets | |||
Cash equivalents | $ 17.7 | $ 11.5 | $ 22.6 |
Other | 25.4 | 22.7 | 11.1 |
Total | 45.1 | 35.4 | 33.7 |
Liabilities | |||
Long-term debt | (37.2) | (38.3) | |
Total | (44.1) | (45.9) | (15.6) |
Interest rate swap agreements | |||
Assets | |||
Derivatives | 1.5 | ||
Liabilities | |||
Derivatives | (2.6) | (6.4) | (10.9) |
Currency forward contracts | |||
Assets | |||
Derivatives | 0.5 | 1.2 | |
Liabilities | |||
Derivatives | (4) | (0.8) | (0.2) |
Commodity hedging instruments | |||
Liabilities | |||
Derivatives | (0.3) | (0.4) | (4.5) |
Quoted Prices in Active Markets for Identical Assets (Level 1) | |||
Assets | |||
Cash equivalents | 17.7 | 11.5 | 22.6 |
Other | 14.5 | 11.8 | 11.1 |
Total | 32.2 | 23.3 | 33.7 |
Liabilities | |||
Long-term debt | 0 | 0 | |
Total | 0 | 0 | 0 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Interest rate swap agreements | |||
Assets | |||
Derivatives | 0 | ||
Liabilities | |||
Derivatives | 0 | 0 | 0 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Currency forward contracts | |||
Assets | |||
Derivatives | 0 | 0 | |
Liabilities | |||
Derivatives | 0 | 0 | 0 |
Quoted Prices in Active Markets for Identical Assets (Level 1) | Commodity hedging instruments | |||
Liabilities | |||
Derivatives | 0 | 0 | 0 |
Significant Other Observable Inputs (Level 2) | |||
Assets | |||
Cash equivalents | 0 | 0 | 0 |
Other | 0 | 0 | 0 |
Total | 2 | 1.2 | 0 |
Liabilities | |||
Long-term debt | 0 | 0 | |
Total | (6.9) | (7.6) | (15.6) |
Significant Other Observable Inputs (Level 2) | Interest rate swap agreements | |||
Assets | |||
Derivatives | 1.5 | ||
Liabilities | |||
Derivatives | (2.6) | (6.4) | (10.9) |
Significant Other Observable Inputs (Level 2) | Currency forward contracts | |||
Assets | |||
Derivatives | 0.5 | 1.2 | |
Liabilities | |||
Derivatives | (4) | (0.8) | (0.2) |
Significant Other Observable Inputs (Level 2) | Commodity hedging instruments | |||
Liabilities | |||
Derivatives | (0.3) | (0.4) | (4.5) |
Unobservable Inputs (Level 3) | |||
Assets | |||
Cash equivalents | 0 | 0 | 0 |
Other | 10.9 | 10.9 | 0 |
Total | 10.9 | 10.9 | 0 |
Liabilities | |||
Long-term debt | (37.2) | (38.3) | |
Total | (37.2) | (38.3) | 0 |
Unobservable Inputs (Level 3) | Interest rate swap agreements | |||
Assets | |||
Derivatives | 0 | ||
Liabilities | |||
Derivatives | 0 | 0 | 0 |
Unobservable Inputs (Level 3) | Currency forward contracts | |||
Assets | |||
Derivatives | 0 | 0 | |
Liabilities | |||
Derivatives | 0 | 0 | 0 |
Unobservable Inputs (Level 3) | Commodity hedging instruments | |||
Liabilities | |||
Derivatives | $ 0 | $ 0 | $ 0 |
SEGMENT INFORMATION (Details)
SEGMENT INFORMATION (Details) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Apr. 01, 2017USD ($) | Apr. 02, 2016USD ($) | Apr. 01, 2017USD ($)segment | Apr. 02, 2016USD ($) | Sep. 30, 2016USD ($) | |
Segment Reporting [Abstract] | |||||
Number of reportable segments | segment | 3 | ||||
Segment Reporting Information [Line Items] | |||||
Net sales | $ 1,203.5 | $ 1,245.2 | $ 1,450.3 | $ 1,439.7 | |
Segment profit (loss) | 256.3 | 350.1 | 156.6 | 227.3 | |
Impairment, restructuring and other | (3.3) | 47.2 | (4.7) | 45.9 | |
Equity in loss of unconsolidated affiliates | (24.1) | 0 | (37.3) | 0 | |
Costs related to refinancing | 0 | 0 | 0 | (8.8) | |
Interest expense | (21.5) | (19.1) | (37.1) | (35.4) | |
Total assets: | |||||
Total assets | 3,838.4 | 3,679.3 | 3,838.4 | 3,679.3 | $ 2,802.8 |
Assets held for sale | 0 | 208.7 | 0 | 208.7 | 0 |
TruGreen Joint Venture | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 154.7 | 406.8 | |||
Interest expense | (16.6) | (33.5) | |||
Restructuring and other charges | 2.1 | 11.7 | |||
Corporate | |||||
Total assets: | |||||
Total assets | 235.6 | 144.2 | 235.6 | 144.2 | 271.9 |
Continuing Operations | |||||
Segment Reporting Information [Line Items] | |||||
Segment profit (loss) | 256.3 | 350.1 | 156.6 | 227.3 | |
Intangible asset amortization | (6.1) | (4.3) | (11.9) | (8.2) | |
Impairment, restructuring and other | (3.3) | 47 | (4.7) | 40.5 | |
Equity in loss of unconsolidated affiliates | (24.1) | 0 | (37.3) | 0 | |
Costs related to refinancing | 0 | 0 | 0 | (8.8) | |
Interest expense | (21.5) | (19.1) | (37.1) | (35.4) | |
Continuing Operations | TruGreen Joint Venture | |||||
Segment Reporting Information [Line Items] | |||||
Restructuring and other charges | 2.1 | 11.7 | |||
Continuing Operations | Operating Segments | |||||
Segment Reporting Information [Line Items] | |||||
Segment profit (loss) | 347.2 | 362.2 | 306.4 | 299.3 | |
Continuing Operations | Corporate | |||||
Segment Reporting Information [Line Items] | |||||
Segment profit (loss) | (35.9) | (35.7) | (58.8) | (60.1) | |
U.S. Consumer | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 962.5 | 1,039.7 | 1,088 | 1,152.9 | |
U.S. Consumer | Operating Segments | |||||
Total assets: | |||||
Total assets | 2,601.3 | 2,636 | 2,601.3 | 2,636 | 1,770.7 |
U.S. Consumer | Continuing Operations | Operating Segments | |||||
Segment Reporting Information [Line Items] | |||||
Segment profit (loss) | 313.8 | 336 | 275.8 | 281.8 | |
Europe Consumer | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 105.3 | 115 | 129.7 | 140.7 | |
Europe Consumer | Operating Segments | |||||
Total assets: | |||||
Total assets | 275.1 | 322.6 | 275.1 | 322.6 | 192.1 |
Europe Consumer | Continuing Operations | Operating Segments | |||||
Segment Reporting Information [Line Items] | |||||
Segment profit (loss) | 18.3 | 21.6 | 9.9 | 12.4 | |
Other | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 135.7 | 90.5 | 232.6 | 146.1 | |
Other | Operating Segments | |||||
Total assets: | |||||
Total assets | 726.4 | 367.8 | 726.4 | 367.8 | $ 568.1 |
Other | Continuing Operations | Operating Segments | |||||
Segment Reporting Information [Line Items] | |||||
Segment profit (loss) | $ 15.1 | $ 4.6 | $ 20.7 | $ 5.1 |
SUBSEQUENT EVENT (Details)
SUBSEQUENT EVENT (Details) - Subsequent Event - International Business - Exponent - EUR (€) | May 10, 2017 | Apr. 29, 2017 |
Subsequent Event [Line Items] | ||
Expected proceeds from sale of business | € 210,000,000 | |
Contingent consideration | 20,000,000 | |
Break fee | € 10,000,000 | |
Sierra | ||
Subsequent Event [Line Items] | ||
Vendor financing | € 25,000,000 | |
Term of financing | 7 years | |
FInancing interest rate | 5.00% | |
Annual interest rate increase | 2.50% |
FINANCIAL INFORMATION FOR SUB77
FINANCIAL INFORMATION FOR SUBSIDIARY GUARANTORS AND NON-GUARANTORS - Additional information (Details) - USD ($) | 6 Months Ended | ||
Apr. 01, 2017 | Apr. 02, 2016 | Dec. 15, 2015 | |
Disclosure of Dividends Paid | |||
Revolving loan term | 5 years | ||
Return of investments from affiliates | $ 0 | ||
Parent | Reportable Legal Entities | |||
Disclosure of Dividends Paid | |||
Return of investments from affiliates | 351,500,000 | $ 313,800,000 | |
Subsidiary Guarantors | Reportable Legal Entities | |||
Disclosure of Dividends Paid | |||
Return of investments from affiliates | $ 32,400,000 | ||
Senior Notes – 6.000% | Senior Notes | |||
Disclosure of Dividends Paid | |||
Interest rate of debt | 6.00% | 6.00% | |
Senior Notes – 5.250% | Senior Notes | |||
Disclosure of Dividends Paid | |||
Interest rate of debt | 5.25% | ||
Senior Notes - 6.625% | Senior Notes | |||
Disclosure of Dividends Paid | |||
Interest rate of debt | 6.625% | 6.625% | |
Repurchased debt amount | $ 200,000,000 |
FINANCIAL INFORMATION FOR SUB78
FINANCIAL INFORMATION FOR SUBSIDIARY GUARANTORS AND NON-GUARANTORS - Condensed Consolidating Statement of Operations (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Apr. 01, 2017 | Apr. 02, 2016 | Apr. 01, 2017 | Apr. 02, 2016 | |
Schedule of Condensed Consolidating Statement of Operations [Line Items] | ||||
Net sales | $ 1,203.5 | $ 1,245.2 | $ 1,450.3 | $ 1,439.7 |
Cost of sales | 701.1 | 723.5 | 903.7 | 896.3 |
Cost of sales—impairment, restructuring and other | 0 | 0.1 | 0 | 5.1 |
Gross profit | 502.4 | 521.6 | 546.6 | 538.3 |
Operating expenses: | ||||
Selling, general and administrative | 197.8 | 200.9 | 316.9 | 314.2 |
Impairment, restructuring and other | 3.3 | (47.2) | 4.7 | (45.9) |
Other (income) loss, net | (0.6) | (1.3) | (6) | (1.5) |
Income (loss) from operations | 301.9 | 369.2 | 231 | 271.5 |
Equity (income) loss in subsidiaries | 0 | 0 | 0 | 0 |
Other non-operating (income) loss | 0 | 0 | 0 | |
Equity in (income) loss of unconsolidated affiliates | 24.1 | 0 | 37.3 | 0 |
Costs related to refinancing | 0 | 0 | 0 | 8.8 |
Interest expense | 21.5 | 19.1 | 37.1 | 35.4 |
Income (loss) from continuing operations before income taxes | 256.3 | 350.1 | 156.6 | 227.3 |
Income tax (benefit) expense from continuing operations | 91 | 124.3 | 55.6 | 80.7 |
Income (loss) from continuing operations | 165.3 | 225.8 | 101 | 146.6 |
Income (loss) from discontinued operations, net of tax | (0.1) | (16) | (0.7) | (17.5) |
Net income (loss) | 165.2 | 209.8 | 100.3 | 129.1 |
Net (income) loss attributable to noncontrolling interest | (0.1) | 0.3 | (0.5) | (0.1) |
Net income (loss) attributable to controlling interest | 165.1 | 210.1 | 99.8 | 129 |
Eliminations/ Consolidations | ||||
Schedule of Condensed Consolidating Statement of Operations [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
Cost of sales | 0 | 0 | 0 | 0 |
Cost of sales—impairment, restructuring and other | 0 | 0 | ||
Gross profit | 0 | 0 | 0 | 0 |
Operating expenses: | ||||
Selling, general and administrative | 0.4 | 0.4 | 0.7 | 0.7 |
Impairment, restructuring and other | 0 | 0 | 0 | 0 |
Other (income) loss, net | 0 | 0 | 0 | 0 |
Income (loss) from operations | (0.4) | (0.4) | (0.7) | (0.7) |
Equity (income) loss in subsidiaries | 182.1 | 224.3 | 122.4 | 154.3 |
Other non-operating (income) loss | 11.5 | 14.9 | 21.7 | 25.5 |
Equity in (income) loss of unconsolidated affiliates | 0 | 0 | ||
Costs related to refinancing | 0 | |||
Interest expense | (11.5) | (14.9) | (21.7) | (25.5) |
Income (loss) from continuing operations before income taxes | (182.5) | (224.7) | (123.1) | (155) |
Income tax (benefit) expense from continuing operations | 0 | 0 | 0 | 0 |
Income (loss) from continuing operations | (182.5) | (224.7) | (123.1) | (155) |
Income (loss) from discontinued operations, net of tax | 0 | 0 | 0 | 0 |
Net income (loss) | (182.5) | (224.7) | (123.1) | (155) |
Net (income) loss attributable to noncontrolling interest | (0.1) | 0.3 | (0.5) | (0.1) |
Net income (loss) attributable to controlling interest | (182.6) | (224.4) | (123.6) | (155.1) |
Parent | Reportable Legal Entities | ||||
Schedule of Condensed Consolidating Statement of Operations [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
Cost of sales | 0 | 0 | 0 | 0 |
Cost of sales—impairment, restructuring and other | 0 | 0 | ||
Gross profit | 0 | 0 | 0 | 0 |
Operating expenses: | ||||
Selling, general and administrative | 0 | 0 | 0 | 0 |
Impairment, restructuring and other | 0 | 0 | 0 | 0 |
Other (income) loss, net | (0.2) | 0 | (0.4) | 0 |
Income (loss) from operations | 0.2 | 0 | 0.4 | 0 |
Equity (income) loss in subsidiaries | (173.8) | (216.6) | (115.4) | (149) |
Other non-operating (income) loss | (7.5) | (8.7) | (11.8) | (13.2) |
Equity in (income) loss of unconsolidated affiliates | 0 | 0 | ||
Costs related to refinancing | 8.8 | |||
Interest expense | 20.5 | 18.2 | 35.3 | 34.2 |
Income (loss) from continuing operations before income taxes | 161 | 207.1 | 92.3 | 119.2 |
Income tax (benefit) expense from continuing operations | (4.6) | (3.4) | (8.2) | (10.6) |
Income (loss) from continuing operations | 165.6 | 210.5 | 100.5 | 129.8 |
Income (loss) from discontinued operations, net of tax | 0 | 0 | 0 | 0 |
Net income (loss) | 165.6 | 210.5 | 100.5 | 129.8 |
Net (income) loss attributable to noncontrolling interest | 0 | 0 | 0 | 0 |
Net income (loss) attributable to controlling interest | 165.6 | 210.5 | 100.5 | 129.8 |
Subsidiary Guarantors | Reportable Legal Entities | ||||
Schedule of Condensed Consolidating Statement of Operations [Line Items] | ||||
Net sales | 998.8 | 1,069 | 1,144.3 | 1,199.3 |
Cost of sales | 558.4 | 605.2 | 684.8 | 730 |
Cost of sales—impairment, restructuring and other | 0.1 | 5.1 | ||
Gross profit | 440.4 | 463.7 | 459.5 | 464.2 |
Operating expenses: | ||||
Selling, general and administrative | 156 | 162.6 | 241.8 | 247.3 |
Impairment, restructuring and other | 3.7 | (47.5) | 5.1 | (46.2) |
Other (income) loss, net | (1.1) | (0.4) | (6.4) | (1.3) |
Income (loss) from operations | 281.8 | 349 | 219 | 264.4 |
Equity (income) loss in subsidiaries | (8.3) | (7.7) | (7) | (5.3) |
Other non-operating (income) loss | 0 | 0 | 0 | 0 |
Equity in (income) loss of unconsolidated affiliates | 24 | 37.2 | ||
Costs related to refinancing | 0 | |||
Interest expense | 11.4 | 14.6 | 21.3 | 24.7 |
Income (loss) from continuing operations before income taxes | 254.7 | 342.1 | 167.5 | 245 |
Income tax (benefit) expense from continuing operations | 87.4 | 118.5 | 56.8 | 84.8 |
Income (loss) from continuing operations | 167.3 | 223.6 | 110.7 | 160.2 |
Income (loss) from discontinued operations, net of tax | (0.1) | (16) | (0.7) | (17.5) |
Net income (loss) | 167.2 | 207.6 | 110 | 142.7 |
Net (income) loss attributable to noncontrolling interest | 0 | 0 | 0 | 0 |
Net income (loss) attributable to controlling interest | 167.2 | 207.6 | 110 | 142.7 |
Non-Guarantors | Reportable Legal Entities | ||||
Schedule of Condensed Consolidating Statement of Operations [Line Items] | ||||
Net sales | 204.7 | 176.2 | 306 | 240.4 |
Cost of sales | 142.7 | 118.3 | 218.9 | 166.3 |
Cost of sales—impairment, restructuring and other | 0 | |||
Gross profit | 62 | 57.9 | 87.1 | 74.1 |
Operating expenses: | ||||
Selling, general and administrative | 41.4 | 37.9 | 74.4 | 66.2 |
Impairment, restructuring and other | (0.4) | 0.3 | (0.4) | 0.3 |
Other (income) loss, net | 0.7 | (0.9) | 0.8 | (0.2) |
Income (loss) from operations | 20.3 | 20.6 | 12.3 | 7.8 |
Equity (income) loss in subsidiaries | 0 | 0 | 0 | 0 |
Other non-operating (income) loss | (4) | (6.2) | (9.9) | (12.3) |
Equity in (income) loss of unconsolidated affiliates | 0.1 | 0.1 | ||
Costs related to refinancing | 0 | |||
Interest expense | 1.1 | 1.2 | 2.2 | 2 |
Income (loss) from continuing operations before income taxes | 23.1 | 25.6 | 19.9 | 18.1 |
Income tax (benefit) expense from continuing operations | 8.2 | 9.2 | 7 | 6.5 |
Income (loss) from continuing operations | 14.9 | 16.4 | 12.9 | 11.6 |
Income (loss) from discontinued operations, net of tax | 0 | 0 | 0 | 0 |
Net income (loss) | 14.9 | 16.4 | 12.9 | 11.6 |
Net (income) loss attributable to noncontrolling interest | 0 | 0 | 0 | 0 |
Net income (loss) attributable to controlling interest | $ 14.9 | $ 16.4 | $ 12.9 | $ 11.6 |
FINANCIAL INFORMATION FOR SUB79
FINANCIAL INFORMATION FOR SUBSIDIARY GUARANTORS AND NON-GUARANTORS - Condensed Consolidating Statement of Comprehensive Income (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Apr. 01, 2017 | Apr. 02, 2016 | Apr. 01, 2017 | Apr. 02, 2016 | |
Schedule of Condensed Consolidating Statement of Comprehensive Income (Loss) | ||||
Net income | $ 165.2 | $ 209.8 | $ 100.3 | $ 129.1 |
Net foreign currency translation adjustment | 1.8 | 0.3 | (2.2) | (2.5) |
Net change in derivatives | 1.1 | (0.1) | 4.5 | 2 |
Net change in pension and other post-retirement benefits | 0.5 | 0.2 | 0.9 | 0.7 |
Total other comprehensive income (loss) | 3.4 | 0.4 | 3.2 | 0.2 |
Comprehensive income | 168.6 | 210.2 | 103.5 | 129.3 |
Eliminations/ Consolidations | ||||
Schedule of Condensed Consolidating Statement of Comprehensive Income (Loss) | ||||
Net income | (182.5) | (224.7) | (123.1) | (155) |
Net foreign currency translation adjustment | (1.8) | (0.3) | 2.2 | 2.5 |
Net change in derivatives | 0.2 | (0.3) | (0.8) | 0.3 |
Net change in pension and other post-retirement benefits | (0.5) | (0.2) | (0.9) | (0.7) |
Total other comprehensive income (loss) | (2.1) | (0.8) | 0.5 | 2.1 |
Comprehensive income | (184.6) | (225.5) | (122.6) | (152.9) |
Parent | Reportable Legal Entities | ||||
Schedule of Condensed Consolidating Statement of Comprehensive Income (Loss) | ||||
Net income | 165.6 | 210.5 | 100.5 | 129.8 |
Net foreign currency translation adjustment | 1.8 | 0.3 | (2.2) | (2.5) |
Net change in derivatives | 1.1 | (0.1) | 4.5 | 2 |
Net change in pension and other post-retirement benefits | 0.5 | 0.2 | 0.9 | 0.7 |
Total other comprehensive income (loss) | 3.4 | 0.4 | 3.2 | 0.2 |
Comprehensive income | 169 | 210.9 | 103.7 | 130 |
Subsidiary Guarantors | Reportable Legal Entities | ||||
Schedule of Condensed Consolidating Statement of Comprehensive Income (Loss) | ||||
Net income | 167.2 | 207.6 | 110 | 142.7 |
Net foreign currency translation adjustment | 0 | 0 | 0 | 0 |
Net change in derivatives | (0.2) | 0.3 | 0.8 | (0.3) |
Net change in pension and other post-retirement benefits | 0.3 | 0.1 | 0.3 | 0.4 |
Total other comprehensive income (loss) | 0.1 | 0.4 | 1.1 | 0.1 |
Comprehensive income | 167.3 | 208 | 111.1 | 142.8 |
Non-Guarantors | Reportable Legal Entities | ||||
Schedule of Condensed Consolidating Statement of Comprehensive Income (Loss) | ||||
Net income | 14.9 | 16.4 | 12.9 | 11.6 |
Net foreign currency translation adjustment | 1.8 | 0.3 | (2.2) | (2.5) |
Net change in derivatives | 0 | 0 | 0 | 0 |
Net change in pension and other post-retirement benefits | 0.2 | 0.1 | 0.6 | 0.3 |
Total other comprehensive income (loss) | 2 | 0.4 | (1.6) | (2.2) |
Comprehensive income | $ 16.9 | $ 16.8 | $ 11.3 | $ 9.4 |
FINANCIAL INFORMATION FOR SUB80
FINANCIAL INFORMATION FOR SUBSIDIARY GUARANTORS AND NON-GUARANTORS - Condensed Consolidating Statement of Cash Flows (Details) - USD ($) $ in Millions | 6 Months Ended | ||
Apr. 01, 2017 | Apr. 02, 2016 | Dec. 15, 2015 | |
Schedule of Condensed Consolidating Statement of Cash Flows [Line Items] | |||
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES | $ (497.8) | $ (627.8) | |
INVESTING ACTIVITIES | |||
Proceeds from sale of long-lived assets | 4.8 | 0.2 | |
Investments in property, plant and equipment | (32.8) | (24.4) | |
Investments in loan receivable | 0 | (72) | |
Investments in unconsolidated affiliates | (0.2) | (2) | |
Investments in acquired businesses, net of cash acquired | (77.9) | 0 | |
Return of investments from affiliates | 0 | ||
Investing cash flows from (to) affiliates | 0 | 0 | |
Net cash used in investing activities | (106.1) | (98.2) | |
FINANCING ACTIVITIES | |||
Borrowings under revolving and bank lines of credit and term loans | 944.6 | 1,573.2 | |
Repayments under revolving and bank lines of credit and term loans | (395) | (959.8) | |
Proceeds from issuance of Senior Notes | 250 | 400 | |
Repayment of 6.625% Senior Notes | 0 | (200) | |
Financing and issuance fees | (3.9) | (10.5) | |
Dividends paid | (59.9) | (57.7) | |
Distribution paid by AeroGrow | (8.1) | 0 | |
Purchase of Common Shares | (90.4) | (42.8) | |
Payments on seller notes | (13.2) | (2.3) | |
Excess tax benefits from share-based payment arrangements | 4 | 4.2 | |
Cash received from the exercise of stock options | 1.7 | 9.2 | |
Financing cash flows from (to) affiliates | 0 | ||
Net cash provided by financing activities | 629.8 | 713.5 | |
Effect of exchange rate changes on cash | (1.7) | (1.6) | |
Net increase (decrease) in cash and cash equivalents | 24.2 | (14.1) | |
Cash and cash equivalents at beginning of period | 50.1 | 71.4 | |
Cash and cash equivalents at end of period | $ 74.3 | $ 57.3 | |
Senior Notes | Senior Notes – 5.250% | |||
FINANCING ACTIVITIES | |||
Interest rate of debt | 5.25% | ||
Senior Notes | Senior Notes – 6.000% | |||
FINANCING ACTIVITIES | |||
Interest rate of debt | 6.00% | 6.00% | |
Senior Notes | Senior Notes - 6.625% | |||
FINANCING ACTIVITIES | |||
Interest rate of debt | 6.625% | 6.625% | |
Eliminations/ Consolidations | |||
Schedule of Condensed Consolidating Statement of Cash Flows [Line Items] | |||
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES | $ 0 | $ (313.8) | |
INVESTING ACTIVITIES | |||
Proceeds from sale of long-lived assets | 0 | 0 | |
Investments in property, plant and equipment | 0 | 0 | |
Investments in loan receivable | 0 | ||
Investments in unconsolidated affiliates | 0 | 0 | |
Investments in acquired businesses, net of cash acquired | 0 | ||
Return of investments from affiliates | (383.9) | ||
Investing cash flows from (to) affiliates | 713 | 395 | |
Net cash used in investing activities | 329.1 | 395 | |
FINANCING ACTIVITIES | |||
Borrowings under revolving and bank lines of credit and term loans | 0 | 0 | |
Repayments under revolving and bank lines of credit and term loans | 0 | 0 | |
Proceeds from issuance of Senior Notes | 0 | 0 | |
Repayment of 6.625% Senior Notes | 0 | ||
Financing and issuance fees | 0 | 0 | |
Dividends paid | 351.5 | 313.8 | |
Distribution paid by AeroGrow | 32.4 | ||
Purchase of Common Shares | 0 | 0 | |
Payments on seller notes | 0 | 0 | |
Excess tax benefits from share-based payment arrangements | 0 | 0 | |
Cash received from the exercise of stock options | 0 | 0 | |
Financing cash flows from (to) affiliates | (713) | (395) | |
Net cash provided by financing activities | (329.1) | (81.2) | |
Effect of exchange rate changes on cash | 0 | 0 | |
Net increase (decrease) in cash and cash equivalents | 0 | 0 | |
Cash and cash equivalents at beginning of period | 0 | 0 | |
Cash and cash equivalents at end of period | 0 | 0 | |
Parent | Reportable Legal Entities | |||
Schedule of Condensed Consolidating Statement of Cash Flows [Line Items] | |||
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES | (17) | 292.6 | |
INVESTING ACTIVITIES | |||
Proceeds from sale of long-lived assets | 0 | 0 | |
Investments in property, plant and equipment | 0 | 0 | |
Investments in loan receivable | 0 | ||
Investments in unconsolidated affiliates | 0 | 0 | |
Investments in acquired businesses, net of cash acquired | 0 | ||
Return of investments from affiliates | 351.5 | 313.8 | |
Investing cash flows from (to) affiliates | (436.1) | (395) | |
Net cash used in investing activities | (84.6) | (395) | |
FINANCING ACTIVITIES | |||
Borrowings under revolving and bank lines of credit and term loans | 0 | 0 | |
Repayments under revolving and bank lines of credit and term loans | 0 | 0 | |
Proceeds from issuance of Senior Notes | 250 | 400 | |
Repayment of 6.625% Senior Notes | (200) | ||
Financing and issuance fees | (3.8) | (10.5) | |
Dividends paid | (59.9) | (57.7) | |
Distribution paid by AeroGrow | 0 | ||
Purchase of Common Shares | (90.4) | (42.8) | |
Payments on seller notes | 0 | 0 | |
Excess tax benefits from share-based payment arrangements | 4 | 4.2 | |
Cash received from the exercise of stock options | 1.7 | 9.2 | |
Financing cash flows from (to) affiliates | 0 | 0 | |
Net cash provided by financing activities | 101.6 | 102.4 | |
Effect of exchange rate changes on cash | 0 | 0 | |
Net increase (decrease) in cash and cash equivalents | 0 | 0 | |
Cash and cash equivalents at beginning of period | 0 | 0 | |
Cash and cash equivalents at end of period | 0 | 0 | |
Subsidiary Guarantors | Reportable Legal Entities | |||
Schedule of Condensed Consolidating Statement of Cash Flows [Line Items] | |||
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES | (386.6) | (492.8) | |
INVESTING ACTIVITIES | |||
Proceeds from sale of long-lived assets | 4.8 | 0.2 | |
Investments in property, plant and equipment | (27.8) | (20.8) | |
Investments in loan receivable | (72) | ||
Investments in unconsolidated affiliates | 0 | (2) | |
Investments in acquired businesses, net of cash acquired | (1.5) | ||
Return of investments from affiliates | 32.4 | ||
Investing cash flows from (to) affiliates | (276.9) | 0 | |
Net cash used in investing activities | (269) | (94.6) | |
FINANCING ACTIVITIES | |||
Borrowings under revolving and bank lines of credit and term loans | 806.2 | 1,429.7 | |
Repayments under revolving and bank lines of credit and term loans | (232.3) | (925.8) | |
Proceeds from issuance of Senior Notes | 0 | 0 | |
Repayment of 6.625% Senior Notes | 0 | ||
Financing and issuance fees | (0.1) | 0 | |
Dividends paid | (351.5) | (313.8) | |
Distribution paid by AeroGrow | 0 | ||
Purchase of Common Shares | 0 | 0 | |
Payments on seller notes | 0 | (1.8) | |
Excess tax benefits from share-based payment arrangements | 0 | 0 | |
Cash received from the exercise of stock options | 0 | 0 | |
Financing cash flows from (to) affiliates | 436.1 | 398.5 | |
Net cash provided by financing activities | 658.4 | 586.8 | |
Effect of exchange rate changes on cash | 0 | 0 | |
Net increase (decrease) in cash and cash equivalents | 2.8 | (0.6) | |
Cash and cash equivalents at beginning of period | 2.7 | 8.2 | |
Cash and cash equivalents at end of period | 5.5 | 7.6 | |
Non-Guarantors | Reportable Legal Entities | |||
Schedule of Condensed Consolidating Statement of Cash Flows [Line Items] | |||
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES | (94.2) | (113.8) | |
INVESTING ACTIVITIES | |||
Proceeds from sale of long-lived assets | 0 | 0 | |
Investments in property, plant and equipment | (5) | (3.6) | |
Investments in loan receivable | 0 | ||
Investments in unconsolidated affiliates | (0.2) | 0 | |
Investments in acquired businesses, net of cash acquired | (76.4) | ||
Return of investments from affiliates | 0 | ||
Investing cash flows from (to) affiliates | 0 | 0 | |
Net cash used in investing activities | (81.6) | (3.6) | |
FINANCING ACTIVITIES | |||
Borrowings under revolving and bank lines of credit and term loans | 138.4 | 143.5 | |
Repayments under revolving and bank lines of credit and term loans | (162.7) | (34) | |
Proceeds from issuance of Senior Notes | 0 | 0 | |
Repayment of 6.625% Senior Notes | 0 | ||
Financing and issuance fees | 0 | 0 | |
Dividends paid | 0 | 0 | |
Distribution paid by AeroGrow | (40.5) | ||
Purchase of Common Shares | 0 | 0 | |
Payments on seller notes | (13.2) | (0.5) | |
Excess tax benefits from share-based payment arrangements | 0 | 0 | |
Cash received from the exercise of stock options | 0 | 0 | |
Financing cash flows from (to) affiliates | 276.9 | (3.5) | |
Net cash provided by financing activities | 198.9 | 105.5 | |
Effect of exchange rate changes on cash | (1.7) | (1.6) | |
Net increase (decrease) in cash and cash equivalents | 21.4 | (13.5) | |
Cash and cash equivalents at beginning of period | 47.4 | 63.2 | |
Cash and cash equivalents at end of period | $ 68.8 | $ 49.7 |
FINANCIAL INFORMATION FOR SUB81
FINANCIAL INFORMATION FOR SUBSIDIARY GUARANTORS AND NON-GUARANTORS - Condensed Consolidating Balance Sheet (Details) - USD ($) $ in Millions | Apr. 01, 2017 | Sep. 30, 2016 | Apr. 02, 2016 | Sep. 30, 2015 |
Current assets: | ||||
Cash and cash equivalents | $ 74.3 | $ 50.1 | $ 57.3 | $ 71.4 |
Accounts receivable, net | 1,121.3 | 196.4 | 954.7 | |
Accounts receivable pledged | 0 | 174.7 | 208.4 | |
Inventories | 658.5 | 448.2 | 619.6 | |
Assets held for sale | 0 | 0 | 208.7 | |
Prepaid and other current assets | 155.5 | 122.3 | 160.1 | |
Total current assets | 2,009.6 | 991.7 | 2,208.8 | |
Investment in unconsolidated affiliates | 59.9 | 101 | 0 | |
Property, plant and equipment, net | 460.9 | 470.8 | 436.3 | |
Goodwill | 401.9 | 373.2 | 284.9 | |
Intangible assets, net | 785.7 | 750.9 | 646.8 | |
Other assets | 120.4 | 115.2 | 102.5 | |
Equity investment in subsidiaries | 0 | 0 | 0 | |
Intercompany assets | 0 | 0 | 0 | |
Total assets | 3,838.4 | 2,802.8 | 3,679.3 | |
Current liabilities: | ||||
Current portion of debt | 32.1 | 185 | 202.9 | |
Accounts payable | 322.6 | 165.9 | 293.8 | |
Liabilities held for sale | 0 | 0 | 62.1 | |
Other current liabilities | 390 | 242.2 | 427.1 | |
Total current liabilities | 744.7 | 593.1 | 985.9 | |
Long-term debt | 2,055.1 | 1,125.1 | 1,758.5 | |
Other liabilities | 347.2 | 350.3 | 247 | |
Equity investment in subsidiaries | 0 | 0 | 0 | |
Intercompany liabilities | 0 | 0 | 0 | |
Total liabilities | 3,147 | 2,068.5 | 2,991.4 | |
Total equity—controlling interest | 678.9 | 715.2 | 675.4 | |
Noncontrolling interest | 12.5 | 19.1 | 12.5 | |
Total equity | 691.4 | 734.3 | 687.9 | 633.1 |
Total liabilities and equity | 3,838.4 | 2,802.8 | 3,679.3 | |
Eliminations/ Consolidations | ||||
Current assets: | ||||
Cash and cash equivalents | 0 | 0 | 0 | 0 |
Accounts receivable, net | 0 | 0 | 0 | |
Accounts receivable pledged | 0 | 0 | ||
Inventories | 0 | 0 | 0 | |
Assets held for sale | 0 | |||
Prepaid and other current assets | 0 | 0 | 0 | |
Total current assets | 0 | 0 | 0 | |
Investment in unconsolidated affiliates | 0 | 0 | ||
Property, plant and equipment, net | 0 | 0 | 0 | |
Goodwill | 11.6 | 11.6 | 11.6 | |
Intangible assets, net | 9.5 | 10.2 | 11 | |
Other assets | (0.4) | (2.5) | (15.3) | |
Equity investment in subsidiaries | (938.7) | (808.8) | (634.8) | |
Intercompany assets | (1,778.4) | (1,013) | (1,814) | |
Total assets | (2,696.4) | (1,802.5) | (2,441.5) | |
Current liabilities: | ||||
Current portion of debt | (15) | (15) | (15) | |
Accounts payable | 0 | 0 | 0 | |
Liabilities held for sale | 0 | |||
Other current liabilities | 0 | 0 | 0 | |
Total current liabilities | (15) | (15) | (15) | |
Long-term debt | (1,375.4) | (652.9) | (1,356.3) | |
Other liabilities | 4.7 | 2.4 | (10.3) | |
Equity investment in subsidiaries | (31.5) | (161) | (176.9) | |
Intercompany liabilities | (371.4) | (334.3) | (333) | |
Total liabilities | (1,788.6) | (1,160.8) | (1,891.5) | |
Total equity—controlling interest | (920.3) | (660.8) | (562.5) | |
Noncontrolling interest | 12.5 | 19.1 | 12.5 | |
Total equity | (907.8) | (641.7) | (550) | |
Total liabilities and equity | (2,696.4) | (1,802.5) | (2,441.5) | |
Parent | Reportable Legal Entities | ||||
Current assets: | ||||
Cash and cash equivalents | 0 | 0 | 0 | 0 |
Accounts receivable, net | 0 | 0 | 0 | |
Accounts receivable pledged | 0 | 0 | ||
Inventories | 0 | 0 | 0 | |
Assets held for sale | 0 | |||
Prepaid and other current assets | 0.7 | 0.1 | 0 | |
Total current assets | 0.7 | 0.1 | 0 | |
Investment in unconsolidated affiliates | 0 | 0 | ||
Property, plant and equipment, net | 0 | 0 | 0 | |
Goodwill | 0 | 0 | 0 | |
Intangible assets, net | 0 | 0 | 0 | |
Other assets | 10.7 | 13.2 | 15.6 | |
Equity investment in subsidiaries | 938.7 | 808.8 | 634.8 | |
Intercompany assets | 1,778.4 | 1,013 | 1,814 | |
Total assets | 2,728.5 | 1,835.1 | 2,464.4 | |
Current liabilities: | ||||
Current portion of debt | 15 | 15 | 15 | |
Accounts payable | 0 | 0 | 0 | |
Liabilities held for sale | 0 | |||
Other current liabilities | 17.8 | 16.6 | 18.9 | |
Total current liabilities | 32.8 | 31.6 | 33.9 | |
Long-term debt | 2,016.1 | 1,085.1 | 1,750 | |
Other liabilities | 0.7 | 3.2 | 5.1 | |
Equity investment in subsidiaries | 0 | 0 | 0 | |
Intercompany liabilities | 0 | 0 | 0 | |
Total liabilities | 2,049.6 | 1,119.9 | 1,789 | |
Total equity—controlling interest | 678.9 | 715.2 | 675.4 | |
Noncontrolling interest | 0 | 0 | 0 | |
Total equity | 678.9 | 715.2 | 675.4 | |
Total liabilities and equity | 2,728.5 | 1,835.1 | 2,464.4 | |
Subsidiary Guarantors | Reportable Legal Entities | ||||
Current assets: | ||||
Cash and cash equivalents | 5.5 | 2.7 | 7.6 | 8.2 |
Accounts receivable, net | 900.8 | 92.4 | 731 | |
Accounts receivable pledged | 174.7 | 208.4 | ||
Inventories | 500.7 | 327.8 | 483.5 | |
Assets held for sale | 208.7 | |||
Prepaid and other current assets | 106.9 | 82.8 | 122.1 | |
Total current assets | 1,513.9 | 680.4 | 1,761.3 | |
Investment in unconsolidated affiliates | 59.1 | 100.3 | ||
Property, plant and equipment, net | 385.8 | 392.1 | 382.3 | |
Goodwill | 262.9 | 260.4 | 260.5 | |
Intangible assets, net | 590.3 | 596.4 | 602 | |
Other assets | 107.8 | 103.8 | 87.2 | |
Equity investment in subsidiaries | 0 | 0 | 0 | |
Intercompany assets | 0 | 0 | 0 | |
Total assets | 2,919.8 | 2,133.4 | 3,093.3 | |
Current liabilities: | ||||
Current portion of debt | 15.8 | 154.2 | 182.9 | |
Accounts payable | 240.6 | 108.8 | 221.9 | |
Liabilities held for sale | 62.1 | |||
Other current liabilities | 261 | 143.6 | 318 | |
Total current liabilities | 517.4 | 406.6 | 784.9 | |
Long-term debt | 1,288.2 | 575.7 | 1,168.8 | |
Other liabilities | 270.6 | 268.7 | 221 | |
Equity investment in subsidiaries | 31.5 | 161 | 176.9 | |
Intercompany liabilities | 97.8 | 147.2 | 269 | |
Total liabilities | 2,205.5 | 1,559.2 | 2,620.6 | |
Total equity—controlling interest | 714.3 | 574.2 | 472.7 | |
Noncontrolling interest | 0 | 0 | 0 | |
Total equity | 714.3 | 574.2 | 472.7 | |
Total liabilities and equity | 2,919.8 | 2,133.4 | 3,093.3 | |
Non-Guarantors | Reportable Legal Entities | ||||
Current assets: | ||||
Cash and cash equivalents | 68.8 | 47.4 | 49.7 | $ 63.2 |
Accounts receivable, net | 220.5 | 104 | 223.7 | |
Accounts receivable pledged | 0 | 0 | ||
Inventories | 157.8 | 120.4 | 136.1 | |
Assets held for sale | 0 | |||
Prepaid and other current assets | 47.9 | 39.4 | 38 | |
Total current assets | 495 | 311.2 | 447.5 | |
Investment in unconsolidated affiliates | 0.8 | 0.7 | ||
Property, plant and equipment, net | 75.1 | 78.7 | 54 | |
Goodwill | 127.4 | 101.2 | 12.8 | |
Intangible assets, net | 185.9 | 144.3 | 33.8 | |
Other assets | 2.3 | 0.7 | 15 | |
Equity investment in subsidiaries | 0 | 0 | 0 | |
Intercompany assets | 0 | 0 | 0 | |
Total assets | 886.5 | 636.8 | 563.1 | |
Current liabilities: | ||||
Current portion of debt | 16.3 | 30.8 | 20 | |
Accounts payable | 82 | 57.1 | 71.9 | |
Liabilities held for sale | 0 | |||
Other current liabilities | 111.2 | 82 | 90.2 | |
Total current liabilities | 209.5 | 169.9 | 182.1 | |
Long-term debt | 126.2 | 117.2 | 196 | |
Other liabilities | 71.2 | 76 | 31.2 | |
Equity investment in subsidiaries | 0 | 0 | 0 | |
Intercompany liabilities | 273.6 | 187.1 | 64 | |
Total liabilities | 680.5 | 550.2 | 473.3 | |
Total equity—controlling interest | 206 | 86.6 | 89.8 | |
Noncontrolling interest | 0 | 0 | 0 | |
Total equity | 206 | 86.6 | 89.8 | |
Total liabilities and equity | $ 886.5 | $ 636.8 | $ 563.1 |