Document and Entity Information
Document and Entity Information - shares | 6 Months Ended | |
Mar. 31, 2018 | May 04, 2018 | |
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 | Mar. 31, 2018 | |
Document Fiscal Year Focus | 2,018 | |
Document Fiscal Period Focus | Q2 | |
Amendment Flag | false | |
Trading Symbol | SMG | |
Entity Common Stock, Shares Outstanding | 55,365,798 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Operations - USD ($) shares in Millions, $ in Millions | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2018 | Apr. 01, 2017 | Mar. 31, 2018 | Apr. 01, 2017 | |
Income Statement [Abstract] | ||||
Net sales | $ 1,013.3 | $ 1,084.6 | $ 1,234.9 | $ 1,292 |
Cost of sales | 604.1 | 620.3 | 791.7 | 790.9 |
Gross profit | 409.2 | 464.3 | 443.2 | 501.1 |
Operating expenses: | ||||
Selling, general and administrative | 166 | 178.8 | 274.2 | 282.9 |
Impairment, restructuring and other | 10.2 | 1 | 10 | 0.8 |
Other (income) expense, net | 0.7 | (0.8) | (1.4) | (6.1) |
Income (loss) from operations | 232.3 | 285.3 | 160.4 | 223.5 |
Equity in (income) loss of unconsolidated affiliates | (1.5) | 24.1 | (2.1) | 37.3 |
Interest expense | 22.6 | 21.5 | 40.4 | 36.8 |
Other non-operating expense, net | 9.2 | 0 | 6.7 | 0 |
Income (loss) from continuing operations before income taxes | 202 | 239.7 | 115.4 | 149.4 |
Income tax expense (benefit) from continuing operations | 49.3 | 85.6 | (17.3) | 53.4 |
Income from continuing operations | 152.7 | 154.1 | 132.7 | 96 |
Income (loss) from discontinued operations, net of tax | (3.7) | 11.1 | (4.9) | 4.3 |
Net income (loss) | 149 | 165.2 | 127.8 | 100.3 |
Net income attributable to noncontrolling interest | (0.1) | (0.1) | (0.1) | (0.5) |
Net income (loss) attributable to controlling interest | $ 148.9 | $ 165.1 | $ 127.7 | $ 99.8 |
Basic income (loss) per common share: | ||||
Income from continuing operations (USD per share) | $ 2.70 | $ 2.58 | $ 2.33 | $ 1.59 |
Income (loss) from discontinued operations (USD per share) | (0.06) | 0.18 | (0.09) | 0.08 |
Basic income (loss) per common share (USD per share) | $ 2.64 | $ 2.76 | $ 2.24 | $ 1.67 |
Weighted-average common shares outstanding during the period (shares) | 56.5 | 59.8 | 57 | 60 |
Diluted income (loss) per common share: | ||||
Income from continuing operations (USD per share) | $ 2.66 | $ 2.54 | $ 2.29 | $ 1.57 |
Income (loss) from discontinued operations (USD per share) | (0.07) | 0.19 | (0.09) | 0.07 |
Diluted income (loss) per common share (USD per share) | $ 2.59 | $ 2.73 | $ 2.20 | $ 1.64 |
Weighted-average common shares outstanding during the period plus dilutive potential common shares (shares) | 57.4 | 60.6 | 58 | 60.9 |
Dividends declared per common share (USD per share) | $ 0.53 | $ 0.5000 | $ 1.06 | $ 1 |
Condensed Consolidated Stateme3
Condensed Consolidated Statements of Comprehensive Income (Loss) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2018 | Apr. 01, 2017 | Mar. 31, 2018 | Apr. 01, 2017 | |
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 149 | $ 165.2 | $ 127.8 | $ 100.3 |
Other comprehensive income (loss): | ||||
Net foreign currency translation adjustment | 15.8 | 1.8 | 15.7 | (2.2) |
Net unrealized gain (loss) on derivative instruments, net of tax of $0.8, $0.0, $1.1 and $1.9, respectively | 2 | 0 | 2.8 | 3 |
Reclassification of net unrealized (gain) loss on derivatives to net income, net of tax of $(0.4), $0.7, $(0.5) and $0.9, respectively | (1.1) | 1.1 | (1.2) | 1.5 |
Reclassification of net pension and other post-retirement benefits loss to net income, net of tax of $0.1, $0.3, $0.2 and $0.6, respectively | 0.3 | 0.5 | 0.6 | 0.9 |
Total other comprehensive income (loss) | 17 | 3.4 | 17.9 | 3.2 |
Comprehensive income (loss) | $ 166 | $ 168.6 | $ 145.7 | $ 103.5 |
Condensed Consolidated Stateme4
Condensed Consolidated Statements of Comprehensive Income (Loss) (Parenthetical) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2018 | Apr. 01, 2017 | Mar. 31, 2018 | Apr. 01, 2017 | |
Statement of Comprehensive Income [Abstract] | ||||
Net unrealized gains (losses) on derivatives - tax impact | $ 0.8 | $ 0 | $ 1.1 | $ 1.9 |
Reclassification of net unrealized losses on derivatives - tax impact | (0.4) | 0.7 | (0.5) | 0.9 |
Reclassification of pension and post-retirement benefit loss - tax impact | $ 0.1 | $ 0.3 | $ 0.2 | $ 0.6 |
Condensed Consolidated Stateme5
Condensed Consolidated Statements of Cash Flows - USD ($) $ in Millions | 6 Months Ended | |
Mar. 31, 2018 | Apr. 01, 2017 | |
OPERATING ACTIVITIES | ||
Net income | $ 127.8 | $ 100.3 |
Adjustments to reconcile net income to net cash used in operating activities: | ||
Share-based compensation expense | 15.7 | 15.1 |
Depreciation | 25.5 | 27.6 |
Amortization | 14.1 | 12.3 |
Deferred taxes | (45.9) | 0 |
(Gain) loss on long-lived assets | (0.2) | 0.8 |
Loss on sale / contribution of business | 3.5 | (0.3) |
Recognition of accumulated foreign currency translation loss | 11.7 | 0 |
Equity in (income) loss and distributions from unconsolidated affiliates | (2.1) | 39.5 |
Changes in assets and liabilities, net of acquired businesses: | ||
Accounts receivable | (643) | (749.9) |
Inventories | (184.1) | (207.9) |
Prepaid and other assets | (9.1) | (29) |
Accounts payable | 113.9 | 167.1 |
Other current liabilities | 97.3 | 148.1 |
Restructuring | 5.2 | (14.6) |
Other non-current items | (12.9) | 1.8 |
Other, net | (0.2) | 0.1 |
Net cash used in operating activities | (482.8) | (489) |
INVESTING ACTIVITIES | ||
Proceeds from sale of long-lived assets | 0.2 | 4.8 |
Post-closing working capital payment related to sale of International Business | (35.3) | 0 |
Investments in property, plant and equipment | (33.1) | (32.8) |
Investments in loans receivable | (7.7) | 0 |
Net (investments in) distributions from unconsolidated affiliates | 0 | (0.2) |
Investments in acquired businesses, net of cash acquired | (144.2) | (77.9) |
Net cash provided by (used in) investing activities | (220.1) | (106.1) |
FINANCING ACTIVITIES | ||
Borrowings under revolving and bank lines of credit and term loans | 1,172.6 | 944.6 |
Repayments under revolving and bank lines of credit and term loans | (243.4) | (395) |
Proceeds from issuance of 5.250% Senior Notes | 0 | 250 |
Financing and issuance fees | 0 | (3.9) |
Dividends paid | (60.3) | (59.9) |
Distribution paid by AeroGrow to noncontrolling interest | 0 | (8.1) |
Purchase of Common Shares | (256.8) | (99.2) |
Payments on seller notes | (3) | (13.2) |
Excess tax benefits from share-based payment arrangements | 0 | 4 |
Cash received from the exercise of stock options | 3.8 | 1.7 |
Net cash provided by financing activities | 612.9 | 621 |
Effect of exchange rate changes on cash | 2.5 | (1.7) |
Net increase (decrease) in cash and cash equivalents | (87.5) | 24.2 |
Cash and cash equivalents at beginning of period | 120.5 | 28.6 |
Cash and cash equivalents at beginning of period classified within assets held for sale | 0 | 21.5 |
Cash and cash equivalents at beginning of period | 120.5 | 50.1 |
Cash and cash equivalents at end of period | $ 33 | $ 74.3 |
Condensed Consolidated Stateme6
Condensed Consolidated Statements of Cash Flows (Parenthetical) | Mar. 31, 2018 | Sep. 30, 2017 | Apr. 01, 2017 | Dec. 15, 2016 |
Senior Notes | Senior Notes – 5.250% | ||||
Interest rate of debt | 5.25% | 5.25% | 5.25% | 5.25% |
Condensed Consolidated Balance
Condensed Consolidated Balance Sheets - USD ($) $ in Millions | Mar. 31, 2018 | Sep. 30, 2017 | Apr. 01, 2017 |
Current assets: | |||
Cash and cash equivalents | $ 33 | $ 120.5 | $ 55.4 |
Accounts receivable, less allowances of $6.9, $6.9 and $3.1, respectively | 598 | 197.7 | 978.3 |
Accounts receivable pledged | 333.3 | 88.9 | 0 |
Inventories | 596.9 | 407.5 | 596.5 |
Assets held for sale | 0 | 0 | 331.5 |
Prepaid and other current assets | 78.1 | 67.1 | 85.7 |
Total current assets | 1,639.3 | 881.7 | 2,047.4 |
Investment in unconsolidated affiliates | 33.2 | 31.1 | 59.9 |
Property, plant and equipment, net of accumulated depreciation of $614.2, $570.9 and $591.1, respectively | 463.6 | 467.7 | 437.1 |
Goodwill | 466.8 | 441.6 | 400.6 |
Intangible assets, net | 777.6 | 748.9 | 726.8 |
Other assets | 195 | 176 | 120.2 |
Total assets | 3,575.5 | 2,747 | 3,792 |
Current liabilities: | |||
Current portion of debt | 335.8 | 143.1 | 32.1 |
Accounts payable | 253.5 | 153.1 | 270.8 |
Liabilities held for sale | 0 | 0 | 154.7 |
Other current liabilities | 316.8 | 248.3 | 318.1 |
Total current liabilities | 906.1 | 544.5 | 775.7 |
Long-term debt | 1,937.7 | 1,258 | 2,042.9 |
Distributions in excess of investment in unconsolidated affiliate | 21.9 | 21.9 | 0 |
Other liabilities | 213.9 | 260.9 | 282 |
Total liabilities | 3,079.6 | 2,085.3 | 3,100.6 |
Commitments and contingencies (Note 12) | |||
Equity: | |||
Common shares and capital in excess of $.01 stated value per share; 55.6, 59.6 and 58.1 shares issued and outstanding, respectively | 409 | 407.6 | 399.8 |
Retained earnings | 1,044.5 | 978.2 | 921 |
Treasury shares, at cost; 12.5, 8.5 and 10.0 shares, respectively | (911.4) | (667.8) | (528.2) |
Accumulated other comprehensive loss | (51.3) | (69.2) | (113.7) |
Total equity—controlling interest | 490.8 | 648.8 | 678.9 |
Noncontrolling interest | 5.1 | 12.9 | 12.5 |
Total equity | 495.9 | 661.7 | 691.4 |
Total liabilities and equity | $ 3,575.5 | $ 2,747 | $ 3,792 |
Condensed Consolidated Balance8
Condensed Consolidated Balance Sheets (Parenthetical) - USD ($) shares in Millions, $ in Millions | Mar. 31, 2018 | Sep. 30, 2017 | Apr. 01, 2017 |
Statement of Financial Position [Abstract] | |||
Accounts receivable, allowances | $ 6.9 | $ 3.1 | $ 6.9 |
Property, plant and equipment, accumulated depreciation | $ 614.2 | $ 591.1 | $ 570.9 |
Common shares stated value (USD per share) | $ 0.01 | $ 0.01 | $ 0.01 |
Common shares issued (shares) | 55.6 | 58.1 | 59.6 |
Common shares outstanding (shares) | 55.6 | 58.1 | 59.6 |
Treasury shares, at cost (shares) | 12.5 | 10 | 8.5 |
SUMMARY OF SIGNIFICANT ACCOUNTI
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES | 6 Months Ended |
Mar. 31, 2018 | |
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 branded products for lawn and garden care and indoor and hydroponic gardening. 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, indoor gardening and hydroponic product distributors and retailers. The Company’s products are sold primarily in North America, Europe and Asia. Prior to August 31, 2017, the Company operated consumer lawn and garden businesses located in Australia, Austria, Belgium, Luxembourg, Czech Republic, France, Germany, Poland and the United Kingdom (the “International Business”). On April 29, 2017, the Company received a binding and irrevocable conditional offer (the “Offer”) from Exponent Private Equity LLP (“Exponent”) to purchase the International Business. On July 5, 2017, the Company accepted the Offer and entered into the Share and Business Sale Agreement (the “Agreement”) contemplated by the Offer. Pursuant to the Agreement, Scotts-Sierra Investments LLC, an indirect wholly-owned subsidiary of the Company (“Sierra”) and certain of its direct and indirect subsidiaries, entered into separate stock or asset sale transactions with respect to the the International Business. As a result, effective in its fourth quarter of fiscal 2017, the Company classified its results of operations for all periods presented to reflect the International Business as a discontinued operation and classified the assets and liabilities of the International Business as held for sale. See “NOTE 2. DISCONTINUED OPERATIONS” for further discussion. Refer to “NOTE 15. SEGMENT INFORMATION” for discussion of the Company’s new reportable segments effective in the fourth quarter of fiscal 2017. 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 March 31, 2018 and April 1, 2017 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”), in which the Company has a controlling interest, is 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) loss 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, 2017 (the “2017 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, 2017 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 in operating expenses in the Condensed Consolidated Statements of Operations. Interest income is recorded on an accrual basis. For the three and six months ended March 31, 2018 , the Company has classified interest income on loans receivable of $2.5 million and $5.0 million , respectively, in the “Other non-operating expense, net” line in the Condensed Consolidated Statements of Operations. For the three and six months ended April 1, 2017 , interest income on loans receivable of $2.1 million and $4.8 million , respectively, is classified in the “Other (income) expense, net” line in the Condensed Consolidated Statements of Operations. Long-Lived Assets The Company had non-cash investing activities of $3.3 million and $2.3 million during the six months ended March 31, 2018 and April 1, 2017 , 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: SIX MONTHS ENDED MARCH 31, APRIL 1, (In millions) Interest paid $ (35.7 ) $ (26.5 ) Income taxes paid (14.5 ) (3.2 ) Property and equipment acquired under capital leases — (0.6 ) During the six months ended March 31, 2018 , the Company paid contingent consideration of $3.0 million related to the fiscal 2016 acquisition of Gavita Holdings B.V., and its subsidiaries (collectively, “Gavita”). During the six months ended April 1, 2017 , the Company paid contingent consideration of $6.7 million and $6.5 million , respectively, related to the fiscal 2 014 acqui sition of Fafard & Brothers Ltd. (“Fafard”) and the fiscal 2 016 acqui sition of a Canadian growing media operation. 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. RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS Income Taxes On December 22, 2017, H.R.1 (the “Act,” formerly known as the “Tax Cuts and Jobs Act”) was signed into law and provides for significant changes to the U.S. Internal Revenue Code of 1986, as amended (the “Code”). Among other items, the Act implements a territorial tax system, imposes a one-time transition tax on deemed repatriated earnings of foreign subsidiaries, and permanently reduces the federal corporate tax rate to 21% effective January 1, 2018. Additionally, the SEC released Staff Accounting Bulletin No. 118 (“SAB 118”) which provides guidance on accounting for the Act’s impact under Accounting Standards Codification (“ASC”) Topic 740, Income Taxes (“ASC 740”). The guidance in SAB 118 addresses certain fact patterns where the accounting for changes in tax laws or tax rates under ASC 740 is incomplete upon issuance of an entity's financial statements for the reporting period in which the Act is enacted. Under the staff guidance in SAB 118, in the financial reporting period in which the Act is enacted, the income tax effects of the Act (i.e., only for those tax effects in which the accounting under ASC 740 is incomplete) would be reported as a provisional amount based on a reasonable estimate (to the extent a reasonable estimate can be determined), which would be subject to adjustment during a “measurement period” until the accounting under ASC 740 is complete. The measurement period is limited to no more than one year beyond the enactment date under the staff's guidance. SAB 118 also describes supplemental disclosures that should accompany the provisional amounts, including the reasons for the incomplete accounting, the additional information or analysis that is needed, and other information relevant to why the registrant was not able to complete the accounting required under ASC 740 in a timely manner. For discussion of the impacts of the Act that are material to the Company and required disclosures related to the Act pursuant to the guidance provided under SAB 118, refer to “NOTE 11. INCOME TAXES.” Share-Based Compensation In March 2016, the Financial Accounting Standards Board (“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 Company adopted this guidance effective October 1, 2017. The impact resulting from the adoption of this amended guidance is summarized below. The amended accounting guidance requires all excess tax benefits and tax deficiencies to be recognized as income tax benefit or expense on a prospective basis in the period of adoption. The adoption of this provision of the amended accounting guidance resulted in the recognition of excess tax benefits of $1.5 million and $1.9 million in the “Income tax expense (benefit) from continuing operations” line in the Condensed Consolidated Statement of Operations for the three and six months ended March 31, 2018 , respectively. As the Company adopted the guidance on a prospective basis, prior year activity has not been adjusted to conform with the current presentation and excess tax benefits of $3.2 million and $4.0 million have been recognized in the “Capital in excess of stated value” line within “Total equity—controlling interest” in the Condensed Consolidated Balance Sheets for the three and six months ended April 1, 2017 , respectively. The amended accounting guidance requires excess tax benefits to be classified as an operating activity in the statement of cash flows. Previously, excess tax benefits were presented as a cash inflow from financing activities and cash outflow from operating activities. The Company has elected to present these changes on a prospective basis and therefore the six months ended April 1, 2017 has not been adjusted to conform with the current presentation. The amended accounting guidance requires cash paid to a tax authority when shares are withheld to satisfy statutory income tax withholding obligations to be classified as a financing activity in the statement of cash flows. The Company’s retrospective adoption of this provision of the amended accounting guidance resulted in the classification of payments of $2.9 million and $8.8 million as cash outflows from financing activities for the six months ended March 31, 2018 and April 1, 2017 , respectively. The Company has elected to continue to estimate the number of awards expected to vest, as permitted by the amended accounting guidance, rather than electing to account for forfeitures as they occur. Derivatives and Hedging In August 2017, the FASB issued an accounting standard update that modifies hedge accounting by making more hedge strategies eligible for hedge accounting, amending presentation and disclosure requirements, and changing how companies assess effectiveness. The intent is to simplify application of hedge accounting and increase transparency of information about an entity’s risk management activities. The Company early adopted this guidance effective October 1, 2017. The adoption of this guidance did not have a significant impact on the Company’s consolidated financial position, results of operations or 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 Company adopted this guidance on a prospective basis effective October 1, 2017. The adoption of this guidance did not 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 Company adopted this guidance on a retrospective basis during the fourth quarter of fiscal 2017. As a result, deferred tax assets totaling $43.1 million have been presented net within other liabilities in the Condensed Consolidated Balance Sheet as of April 1, 2017 . This amount was previously reported within prepaid and other current assets. RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS 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 standard involves a five-step process that includes identifying the contract with the customer, identifying the performance obligations in the contract, determining the transaction price, allocating the transaction price to the performance obligations in the contract and recognizing revenue when the entity satisfies the performance obligations. 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 Company has made progress on its evaluation of the amended guidance, including identification of revenue streams and customer contract reviews. The Company is applying the five-step model to those contracts and revenue streams to evaluate the quantitative and qualitative impacts the new standard will have on its business and reported revenues. The provisions are effective for the Company in the first quarter of fiscal 2019 and the Company expects to adopt under the modified retrospective approach, which recognizes the cumulative effect of adoption as an adjustment to retained earnings at the date of initial application. The Company’s revenue is primarily product sales, which are recognized at a point in time when title transfers to customers and the Company has no further obligation to provide services related to such products. Although the Company is continuing to assess the impact of the amended guidance, it generally anticipates that its timing of recognition of revenue will be substantially unchanged under the amended guidance. 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 as of 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. The Company has made progress on its evaluation of the amended guidance, including identification of the population of leases affected, determining the information required to calculate the lease liability and right-of-use asset and evaluating models to assist in future reporting. 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 |
Mar. 31, 2018 | |
Discontinued Operations and Disposal Groups [Abstract] | |
DISCONTINUED OPERATIONS | DISCONTINUED OPERATIONS International Business On August 31, 2017, the Company completed the sale of the International Business for cash proceeds of $150.6 million at closing, which is net of seller financing provided by the Company in the form of a $29.7 million loan for seven years bearing interest at 5% for the first three years, with annual 2.5% increases thereafter. The transaction also included contingent consideration, a non-cash investing activity, with a maximum payout of $23.8 million and an initial fair value of $18.2 million , the payment of which will depend on the achievement of certain performance criteria by the International Business following the closing of the transaction through fiscal 2020. The seller financing loan and the contingent consideration receivable are recorded in the “Other assets” line in the Condensed Consolidated Balance Sheets. The cash proceeds from the sale were subject to post-closing adjustments and the Company originally accrued $27.8 million at September 30, 2017 in the “Other current liabilities” line in the Condensed Consolidated Balance Sheets related to the expected working capital adjustment obligation in respect of the actual closing date financial position of the International Business. The Company recorded a pre-tax gain on the sale of the International Business of $32.7 million , partially offset by the provision for income taxes of $12.0 million , during fiscal 2017. The fiscal 2017 pre-tax gain included a write-off of accumulated foreign currency translation loss adjustments of $18.5 million . During the three months ended March 31, 2018, the Company recorded a reduction to the gain of $3.7 million related to the resolution of the post-closing working capital adjustment obligation. In connection with the transaction, the Company entered into certain ancillary agreements including a transition services agreement and a material supply agreement, which are not material, as well as a licensing agreement for the use of certain of the Company’s brand names with an initial fair value of $14.1 million . During the three and six months ended March 31, 2018 , the Company recognized $0.2 million and $1.6 million , respectively, as compared to $2.3 million and $3.9 million for the three and six months ended April 1, 2017 , respectively, in transaction related costs associated with the sale of the International Business. Scotts LawnService ® 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 Scotts LawnService ® business (the “SLS Business”) to a newly formed subsidiary of TruGreen Holdings (the “TruGreen Joint Venture”) in exchange for a minority equity interest of approximately 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. 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 a reduction to the gain on the contribution of the SLS Business of $0.3 million related to a post-closing working capital adjustment. The following table summarizes the results of the International Business and SLS Business within discontinued operations for each of the periods presented: THREE MONTHS ENDED SIX MONTHS ENDED MARCH 31, APRIL 1, MARCH 31, APRIL 1, (In millions) Net sales $ — $ 118.9 $ — $ 158.2 Operating and exit costs 1.6 99.8 1.6 146.7 Impairment, restructuring and other 0.2 2.4 1.6 4.6 Other expense, net — 0.2 — 0.1 Loss on sale / contribution of business 3.7 — 3.5 0.3 Interest expense — — — 0.4 Income (loss) from discontinued operations before income taxes (5.5 ) 16.5 (6.7 ) 6.1 Income tax expense (benefit) from discontinued operations (1.8 ) 5.4 (1.8 ) 1.8 Income (loss) from discontinued operations, net of tax $ (3.7 ) $ 11.1 $ (4.9 ) $ 4.3 The following table summarizes the major classes of assets and liabilities held for sale: APRIL 1, (In millions) Cash and cash equivalents $ 18.9 Accounts receivable, net 143.0 Inventories 62.0 Prepaid and other current assets 8.4 Property, plant and equipment, net 23.8 Goodwill and intangible assets, net 60.2 Other assets 15.2 Assets held for sale $ 331.5 Accounts payable $ 51.8 Other current liabilities 71.9 Long-term debt 12.2 Other liabilities 18.8 Liabilities held for sale $ 154.7 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 discontinued operations totaled zero and $65.9 million for the six months ended March 31, 2018 and April 1, 2017 , respectively. Cash used in investing activities related to discontinued operations totaled $35.3 million and $3.1 million for the six months ended March 31, 2018 and April 1, 2017 , respectively. |
ACQUISITION AND INVESTMENTS
ACQUISITION AND INVESTMENTS | 6 Months Ended |
Mar. 31, 2018 | |
Business Combinations [Abstract] | |
ACQUISITIONS AND INVESTMENTS | ACQUISITIONS AND INVESTMENTS Fiscal 2018 On May 26, 2016, the Company’s Hawthorne segment acquired majority control and a 75% economic interest in Gavita. Gavita’s former ownership group initially 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 was recorded at fair value in the “Long-term debt” line in the Condensed Consolidated Balance Sheets. On October 2, 2017 , the Company’s Hawthorne segment acquired the remaining 25% noncontrolling interest in Gavita, including Agrolux, for $69.2 million , plus payment of contingent consideration of $3.0 million . The carrying value of the 25% noncontrolling interest consisted of long-term debt of $55.6 million and noncontrolling interest of $7.9 million . The difference between purchase price and carrying value was recognized in the “Capital in excess of stated value” line within “Total equity—controlling interest” in the Condensed Consolidated Balance Sheets. On October 11, 2017 , the Company’s Hawthorne segment completed the acquisition of substantially all of the U.S. and Canadian assets of Can-Filters Group Inc. (“Can-Filters”) for $74.1 million . Based in British Columbia, Can-Filters is a leading wholesaler of ventilation products for indoor and hydroponic gardening and industrial markets worldwide. The preliminary valuation of the acquired assets included (i) $2.1 million of cash, prepaid and other current assets, (ii) $7.7 million of inventory and accounts receivable, (iii) $4.4 million of fixed assets, (iv) $0.7 million of accounts payable and other current liabilities, (v) $39.7 million of finite-lived identifiable intangible assets, and (vi) $20.9 million of tax-deductible goodwill. Identifiable intangible assets included tradenames and customer relationships with useful lives of 25 years. The estimated fair value 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 Can-Filters included within the Hawthorne segment for the three and six months ended March 31, 2018 were $3.4 million and $7.9 million , respectively. Fiscal 2017 On August 11, 2017 , the Company’s Hawthorne segment completed the acquisition of substantially all of the assets of the exclusive manufacturer and formulator of branded Botanicare ® products for $32.0 million . The valuation of the acquired assets included (i) $0.3 million of inventory, (ii) $5.0 million of finite-lived identifiable intangible assets, and (iii) $26.7 million of tax-deductible goodwill. Identifiable intangible assets included manufacturing know-how and non-compete agreements with useful lives ranging between 5 and 10 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. On May 26, 2017 , the Company’s majority-owned subsidiary Gavita completed the acquisition of Agrolux Holding B.V., and its subsidiaries (collectively, “Agrolux”), for $21.8 million . Based in the Netherlands, Agrolux is a worldwide supplier of horticultural lighting. The purchase price included contingent consideration, a non-cash investing activity, with a maximum payout and estimated fair value of $5.2 million , which was paid subsequent to March 31, 2018 . The valuation of the acquired assets included (i) $8.0 million of cash, prepaid and other current assets, (ii) $10.1 million of inventory and accounts receivable, (iii) $0.5 million of fixed assets, (iv) $8.6 million of accounts payable and other current liabilities, (v) $6.7 million of short term debt, (vi) $16.1 million of finite-lived identifiable intangible assets, (vii) $6.4 million of non-deductible goodwill, and (viii) $4.0 million of deferred tax liabilities. Identifiable intangible assets included tradenames and customer relationships with useful lives ranging between 10 and 20 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 Agrolux included within the Hawthorne segment for the three and six months ended March 31, 2018 were $5.3 million and $26.0 million , respectively. On October 3, 2016 , the Company’s Hawthorne segment 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, of $15.5 million , which was paid during the third quarter of fiscal 2017. The 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 Hawthorne segment for the three and six months ended March 31, 2018 were $8.1 million and $15.2 million , respectively, as compared to $11.3 million and $21.2 million for the three and six months ended April 1, 2017 , 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 . During the third quarter of fiscal 2017, the Company’s Hawthorne segment completed the acquisition of a company focused on the technology supporting hydroponic growing systems for an aggregate purchase price of $3.5 million , which included finite-lived identifiable intangible assets of $3.2 million . |
INVESTMENT IN UNCONSOLIDATED AF
INVESTMENT IN UNCONSOLIDATED AFFILIATES | 6 Months Ended |
Mar. 31, 2018 | |
Equity Method Investments and Joint Ventures [Abstract] | |
INVESTMENT IN UNCONSOLIDATED AFFILIATES | INVESTMENT IN UNCONSOLIDATED AFFILIATES As of March 31, 2018 , the Company held a minority equity interest of approximately 30% in the TruGreen Joint Venture. In addition, the Company and TruGreen Holdings are parties to 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. The LLC Agreement provides the Company with minority representation on the board of directors of the TruGreen Joint Venture. The Company’s interest had an initial fair value of $294.0 million and was previously 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 the first quarter of fiscal 2018, the Company discontinued applying the equity method of accounting for the TruGreen Joint Venture as the Company’s net investment and advances were reduced to a liability. The Company does not have any contractual obligations to fund losses of the TruGreen Joint Venture. In connection with the closing of the transactions contemplated by the Contribution Agreement on April 13, 2016, the Company invested $18.0 million in second lien term loan financing to the TruGreen Joint Venture. The second lien term loan receivable had a carrying value of $18.1 million and $18.0 million at March 31, 2018 and April 1, 2017 , respectively, and is recorded in the “Other assets” line in the Condensed Consolidated Balance Sheets. The Company was reimbursed $0.1 million and $0.6 million during the three and six months ended March 31, 2018 , respectively, and had accounts receivable of $0.5 million at March 31, 2018 for expenses incurred pursuant to a short-term transition services agreement. The Company did not receive distributions from unconsolidated affiliates during the three and six months ended March 31, 2018 . The Company was reimbursed $14.7 million and $33.7 million during the three and six months ended April 1, 2017 , respectively, and had 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. 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 Company also had an indemnification asset of $4.2 million and $7.4 million at March 31, 2018 and April 1, 2017 , respectively, for future payments on claims associated with insurance programs. The Company has received cumulative distributions from the TruGreen Joint Venture in excess of its investment balance, which resulted in an amount recorded in the “Distributions in excess of investment in unconsolidated affiliate” line in the Condensed Consolidated Balance Sheets of $21.9 million at March 31, 2018 . In accordance with the applicable accounting guidance, the Company reclassified the negative balance to the liability section of the Condensed Consolidated Balance Sheet. During the fourth quarter of fiscal 2017, the Company made a $29.4 million investment in an unconsolidated subsidiary whose products support the professional U.S. industrial, turf and ornamental market (the “IT&O Joint Venture”). During the three and six months ended March 31, 2018 , respectively, the Company invested $2.1 million and $7.4 million in line of credit financing to the IT&O Joint Venture, which is recorded in the “Other assets” line in the Condensed Consolidated Balance Sheets. The following table presents summarized financial information of the Company’s unconsolidated affiliates: THREE MONTHS ENDED SIX MONTHS ENDED MARCH 31, APRIL 1, MARCH 31, APRIL 1, (In millions) Revenue $ 175.7 $ 154.7 $ 447.9 $ 406.8 Gross margin 8.4 9.7 84.4 70.8 Selling and administrative expenses 52.4 51.5 116.4 92.9 Amortization expense 10.3 21.7 22.4 41.9 Interest expense 18.0 16.6 35.5 33.5 Restructuring and other charges 8.3 — 11.9 26.6 Net income (loss) $ (80.6 ) $ (80.1 ) $ (101.8 ) $ (124.1 ) Due to the seasonal nature of the lawn, tree and shrub care business, the TruGreen Joint Venture anticipates a net loss during the Company’s first and second fiscal quarters. Net income (loss) does not include income taxes, which are recognized and paid by the partners of the unconsolidated affiliates. The income taxes associated with the Company’s share of net income (loss) have been recorded in the “Income tax expense (benefit) from continuing operations” line in the Condensed Consolidated Statements of Operations. The Company recognized equity in (income) loss of unconsolidated affiliates of $(1.5) million and $(2.1) million for the three and six months ended March 31, 2018 , respectively, as compared to $24.1 million and $37.3 million and for the three and six months ended April 1, 2017 , respectively. The Company’s share of restructuring and other charges incurred by the TruGreen Joint Venture was $2.1 million and $11.7 million for the three and six months ended April 1, 2017 , respectively. For the three and six months ended April 1, 2017 , these charges included zero and $7.9 million , respectively, for nonrecurring integration and separation costs and $2.1 million and $3.8 million , respectively, for a non-cash purchase accounting fair value write-down adjustment related to deferred revenue and advertising. |
IMPAIRMENT, RESTRUCTURING AND O
IMPAIRMENT, RESTRUCTURING AND OTHER | 6 Months Ended |
Mar. 31, 2018 | |
Restructuring and Related Activities [Abstract] | |
IMPAIRMENT, RESTRUCTURING AND OTHER | IMPAIRMENT, RESTRUCTURING AND OTHER Activity described herein is classified within the “Impairment, restructuring and other” and “Income (loss) from discontinued operations, net of tax” lines in the Condensed Consolidated Statements of Operations. The following table details impairment, restructuring and other charges for each of the periods presented: THREE MONTHS ENDED SIX MONTHS ENDED MARCH 31, APRIL 1, MARCH 31, APRIL 1, (In millions) Operating expenses: Restructuring and other charges $ 10.2 $ 1.0 $ 10.0 $ 0.8 Impairment, restructuring and other charges from continuing operations $ 10.2 $ 1.0 $ 10.0 $ 0.8 Restructuring and other charges from discontinued operations 0.2 2.4 1.6 4.6 Total impairment, restructuring and other charges $ 10.4 $ 3.4 $ 11.6 $ 5.4 The following table summarizes the activity related to liabilities associated with restructuring and other, excluding insurance reimbursement recoveries, during the six months ended March 31, 2018 (in millions): Amounts accrued for restructuring and other at September 30, 2017 $ 12.1 Restructuring and other charges from continuing operations 10.0 Restructuring and other charges from discontinued operations 1.6 Payments and other (6.4 ) Amounts accrued for restructuring and other at March 31, 2018 $ 17.3 Included in restructuring accruals, as of March 31, 2018 , is $1.1 million that is classified as long-term. Payments against the long-term accruals will be incurred as the employees covered by the restructuring plan retire or through the passage of time. The remaining amounts accrued will continue to be paid out over the course of the next twelve months. During the three months ended March 31, 2018 , the Company recognized a charge of $10.2 million for a probable loss on a previously disclosed legal matter within the “Impairment, restructuring and other” line in the Condensed Consolidated Statements of Operations. Refer to “NOTE 12. CONTINGENCIES” for more information. 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 March 31, 2018 , the Company’s U.S. Consumer segment recognized adjustments of $0.1 million and $0.3 million , respectively, related to previously recognized termination benefits in the “Impairment, restructuring and other” line in the Condensed Consolidated Statements of Operations. During the three and six months ended April 1, 2017 , the Company’s U.S. Consumer segment recognized charges of $1.0 million and $0.8 million , respectively, related to termination benefits in the “Impairment, restructuring and other” line in the Condensed Consolidated Statements of Operations. Costs incurred to date since the inception of the current Project Focus initiatives are $9.8 million for the U.S. Consumer segment, $1.0 million for the Hawthorne segment and $1.2 million for the Other segment, related to transaction activity, termination benefits and facility closure costs. On April 13, 2016, as part of Project Focus, the Company completed the contribution of the SLS Business to the TruGreen Joint Venture. 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 in the “Income (loss) from discontinued operations, net of tax” line in the Condensed Consolidated Statements of Operations. On August 31, 2017, the Company completed the sale of the International Business. As a result, effective in its fourth quarter of fiscal 2017, the Company classified its results of operations for all periods presented to reflect the International Business as a discontinued operation and classified the assets and liabilities of the International Business as held for sale. Refer to “NOTE 2. DISCONTINUED OPERATIONS” for more information. During the three and six months ended March 31, 2018 , the Company recognized $0.2 million and $1.6 million , respectively, as compared to $2.3 million and $3.9 million for the three and six months ended April 1, 2017 , respectively, in transaction related costs associated with the sale of the International Business in the “Income (loss) from discontinued operations, net of tax” line in the Condensed Consolidated Statements of Operations. |
INVENTORIES
INVENTORIES | 6 Months Ended |
Mar. 31, 2018 | |
Inventory Disclosure [Abstract] | |
INVENTORIES | INVENTORIES Inventories consisted of the following for each of the periods presented: MARCH 31, APRIL 1, SEPTEMBER 30, (In millions) Finished goods $ 395.8 $ 403.8 $ 210.6 Work-in-process 61.2 51.5 57.6 Raw materials 139.9 141.2 139.3 Total inventories $ 596.9 $ 596.5 $ 407.5 Adjustments to reflect inventories at net realizable values were $11.9 million at March 31, 2018 , $7.6 million at April 1, 2017 and $10.5 million at September 30, 2017 . |
MARKETING AGREEMENT
MARKETING AGREEMENT | 6 Months Ended |
Mar. 31, 2018 | |
Marketing Agreement [Abstract] | |
MARKETING AGREEMENT | MARKETING AGREEMENT The Scotts Company LLC (“Scotts LLC”) is the exclusive agent of Monsanto for the marketing and distribution of consumer Roundup ® non-selective weedkiller products in the consumer lawn and garden market in certain countries pursuant to an Amended and Restated Exclusive Agency and Marketing Agreement (the “Original Marketing Agreement”). In consideration for the rights granted to the Company under the Original Marketing Agreement in 1998, the Company paid a marketing fee of $32.0 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 20 years, with a remaining unamortized amount of $0.4 million and remaining amortization period of less than one year. On May 15, 2015, the Company and Monsanto entered into an Amendment to the Original 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 and recorded this amount as intangible assets for which the related economic useful life is indefinite. On August 31, 2017, in connection with and as a condition to the consummation of the Company’s sale of its International Business, the Company entered into the Second Amended and Restated Agency and Marketing Agreement (the “Restated Marketing Agreement”) and the Amended and Restated Lawn and Garden Brand Extension Agreement - Americas (the “Restated Brand Extension Agreement”) to reflect the Company’s transfer and assignment to the purchaser of such business of the Company’s rights and responsibilities under the Original Marketing Agreement, as amended, and the Brand Extension Agreement relating to those countries subject to the sale. The Company included $32.6 million of the carrying amount of the intangible asset associated with the Marketing Agreement Amendment with the International Business disposal unit on the basis of the asset’s historical carrying amount and this amount was disposed of as part of the sale of the International Business. From 1998 until May 15, 2015, the Original Marketing Agreement covered the United States and other specified countries, including Australia, Austria, Belgium, Canada, France, Germany, the Netherlands and the United Kingdom. The Marketing Agreement Amendment expanded the covered territories and countries to include all countries other than Japan and countries subject to a comprehensive U.S. trade embargo or certain other embargoes and trade restrictions. The Restated Marketing Agreement further revised the covered territories and countries to only include Israel, China and every country throughout the Caribbean and the continents of North America and South America that is not subject to a comprehensive U.S. trade embargo or certain other embargoes and trade restrictions. Under the terms of the Restated 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 commission payable under the Restated Marketing Agreement is equal to (1) 50% of the actual earnings before interest and income taxes of the consumer Roundup ® business in the markets covered by the Restated Marketing Agreement for program years 2017 and 2018 and (2) 50% of the actual earnings before interest and income taxes of the consumer Roundup ® business in the markets covered by the Restated Marketing Agreement in excess of $40 million for program years 2019 and thereafter. The Restated Marketing Agreement also requires the Company to make annual payments of $18.0 million to Monsanto as a contribution against the overall expenses of the consumer Roundup ® business. Unless Monsanto terminates the Restated Marketing Agreement due to an event of default by the Company, the Restated Marketing Agreement requires a termination fee payable to the Company equal to the greater of (1) $175.0 million or (2) four times (A) the average of the program earnings before interest and income taxes for the three trailing program years prior to the year of termination, minus (B) $186.4 million . The term of the Restated Marketing Agreement will continue indefinitely for all included markets unless and until otherwise terminated in accordance therewith. The Restated Brand Extension Agreement provides the Company an exclusive license in every country throughout the North American continent, South American continent, Central America, the Caribbean, Israel and China (in each case that is not subject to a comprehensive U.S. trade embargo or certain other embargoes and trade restrictions) 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 Restated Brand Extension Agreement has a 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 Restated Marketing Agreement or the Restated Brand Extension Agreement). Under the terms of the Restated Marketing Agreement, the Company performs sales, merchandising, warehousing and other selling and marketing services, on behalf of Monsanto in the conduct of the consumer Roundup ® business. The Company performs other services, including manufacturing conversion services, pursuant to ancillary agreements. The actual costs incurred for these activities are charged to and reimbursed by Monsanto. The Company records costs incurred 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 Restated 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 MARCH 31, APRIL 1, MARCH 31, APRIL 1, (In millions) Gross commission $ 34.5 $ 41.1 $ 34.6 $ 42.3 Contribution expenses (4.5 ) (4.5 ) (9.0 ) (9.0 ) Amortization of marketing fee (0.2 ) (0.2 ) (0.4 ) (0.4 ) Net commission 29.8 36.4 25.2 32.9 Reimbursements associated with Marketing Agreement 19.7 19.4 32.5 33.6 Total net sales associated with Marketing Agreement $ 49.5 $ 55.8 $ 57.7 $ 66.5 |
DEBT
DEBT | 6 Months Ended |
Mar. 31, 2018 | |
Debt Disclosure [Abstract] | |
DEBT | DEBT The components of debt are as follows: MARCH 31, APRIL 1, SEPTEMBER 30, (In millions) Credit Facilities: Revolving loans $ 1,043.2 $ 1,096.8 $ 300.5 Term loans 266.3 281.3 273.8 Senior Notes – 5.250% 250.0 250.0 250.0 Senior Notes – 6.000% 400.0 400.0 400.0 Receivables facility 300.0 — 80.0 Other 22.0 56.1 105.4 Total debt 2,281.5 2,084.2 1,409.7 Less current portions 335.8 32.1 143.1 Less unamortized debt issuance costs 8.0 9.2 8.6 Long-term debt $ 1,937.7 $ 2,042.9 $ 1,258.0 Credit Facilities On October 29, 2015, the Company entered into the fourth amended and restated credit agreement (the “credit agreement”), which provides the Company and certain of its subsidiaries with five -year senior secured loan facilities in the aggregate principal amount of $1.9 billion that are 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 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 Company’s 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 March 31, 2018 , the Company had letters of credit outstanding in the aggregate principal amount of $22.2 million , and $534.6 million of availability under the credit agreement, subject to the Company’s continued compliance with the covenants discussed below. The weighted average interest rates on average borrowings under the credit agreement were 4.1% and 3.7% for the six months ended March 31, 2018 and April 1, 2017 , respectively. 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 March 31, 2018 . The Company’s leverage ratio was 3.46 at March 31, 2018 . 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 March 31, 2018 . The Company’s interest coverage ratio was 6.70 for the twelve months ended March 31, 2018 . 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 $200.0 million . 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. 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 - 6.000% 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 credit agreement. 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. 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 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), as defined in the Repurchase Agreement, plus 0.90% . On August 25, 2017, the Company entered into Amendment No. 1 to Master Framework Agreement (the “Amendment”). The Amendment (i) extends the expiration date of the Receivables Facility from August 25, 2017 to August 24, 2018, (ii) defines the seasonal commitment period of the Receivables Facility as beginning on February 23, 2018 and ending on June 15, 2018, (iii) increases the eligible amount of customer accounts receivable which may be sold from up to $250.0 million to up to $400.0 million and (iv) increases the commitment amount of the Receivables Facility during the seasonal commitment period from up to $100.0 million to up to $160.0 million . The Company accounts for the sale of receivables under the Receivables Facility as short-term debt and continues to carry the receivables on its Condensed Consolidated Balance Sheet, primarily as a result of the Company’s requirement to repurchase receivables sold. There were $300.0 million in borrowings on receivables pledged as collateral under the Receivables Facility as of March 31, 2018 . The carrying value of the receivables pledged as collateral was $333.3 million as of March 31, 2018 . As of March 31, 2018 , there was $78.4 million of availability under the Receivables Facility. Other In connection with the acquisition of a controlling interest in Gavita during fiscal 2016, the Company recorded a loan to the noncontrolling ownership group of Gavita. On October 2, 2017 , the Company’s Hawthorne segment acquired the remaining 25% noncontrolling interest in Gavita, which included extinguishment of the loan to the noncontrolling ownership group of Gavita with a fair value and carrying value of $55.6 million . The fair value of the loan was $37.2 million and $55.6 million at April 1, 2017 and September 30, 2017 , 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 maximum total U.S. dollar equivalent notional amount of $1,300.0 million at March 31, 2018 , $1,150.0 million at April 1, 2017 and $1,100.0 million at September 30, 2017 , respectively. Interest payments made between the effective date and expiration date are hedged by the swap agreements, except as noted below. The notional amount, effective date, expiration date and rate of each of these swap agreements outstanding at March 31, 2018 are shown in the table below: Notional Amount Effective Expiration Fixed $ 300 (b) 11/21/2016 6/20/2018 0.83 % 200 (b) 11/7/2016 8/7/2018 0.84 % 150 (c) 2/7/2017 5/7/2019 2.12 % 50 (c) 2/7/2017 5/7/2019 2.25 % 50 2/28/2018 5/28/2019 2.01 % 200 (d) 12/20/2016 6/20/2019 2.12 % 250 (b) 1/8/2018 6/8/2020 2.09 % 100 6/20/2018 10/20/2020 2.15 % (a) The effective date refers to the date on which interest payments were first hedged by the applicable swap agreement. (b) Notional amount adjusts in accordance with a specified seasonal schedule. This represents the maximum notional amount at any point in time. (c) 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. (d) 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. 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 March 31, 2018 , the fair value of the 5.250% Senior Notes was approximately $247.5 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 March 31, 2018 , the fair value of the 6.000% Senior Notes was approximately $419.0 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 Receivables Facility fluctuated with the applicable LIBOR and thus the carrying value is a reasonable estimate of fair value. The fair value measurement for the Receivables Facility 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 4.4% and 4.3% for the six months ended March 31, 2018 and April 1, 2017 , respectively. |
RETIREMENT AND RETIREE MEDICAL
RETIREMENT AND RETIREE MEDICAL PLANS | 6 Months Ended |
Mar. 31, 2018 | |
Defined Benefit Plan [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 MARCH 31, 2018 APRIL 1, 2017 U.S. Pension International Pension U.S. Medical U.S. Pension International Pension U.S. Medical (In millions) Service cost $ — $ 0.3 $ 0.1 $ — $ 0.2 $ 0.1 Interest cost 0.7 1.1 0.2 0.7 1.0 0.1 Expected return on plan assets (1.1 ) (2.1 ) — (1.2 ) (2.0 ) — Net amortization 0.4 0.3 (0.3 ) 0.4 0.4 (0.2 ) Net periodic benefit (income) cost $ — $ (0.4 ) $ — $ (0.1 ) $ (0.4 ) $ — SIX MONTHS ENDED MARCH 31, 2018 APRIL 1, 2017 U.S. Pension International Pension U.S. Medical U.S. Pension International Pension U.S. Medical (In millions) Service cost $ — $ 0.5 $ 0.2 $ — $ 0.4 $ 0.2 Interest cost 1.5 2.1 0.3 1.4 1.9 0.3 Expected return on plan assets (2.3 ) (4.1 ) — (2.4 ) (3.9 ) — Net amortization 0.8 0.6 (0.5 ) 0.8 0.9 (0.4 ) Net periodic benefit (income) cost $ — $ (0.9 ) $ — $ (0.2 ) $ (0.7 ) $ 0.1 |
EQUITY
EQUITY | 6 Months Ended |
Mar. 31, 2018 | |
Equity [Abstract] | |
EQUITY | EQUITY The following table provides a summary of the changes in total equity, equity attributable to controlling interest, and equity attributable to noncontrolling interests for the six months ended March 31, 2018 and April 1, 2017 (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, 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 (loss) — — — 3.2 3.2 — 3.2 Share-based compensation 19.1 — — — 19.1 — 19.1 Dividends declared ($1.00 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 Balance at September 30, 2017 $ 407.6 $ 978.2 $ (667.8 ) $ (69.2 ) $ 648.8 $ 12.9 $ 661.7 Net income (loss) — 127.7 — — 127.7 0.1 127.8 Other comprehensive income (loss) — — — 17.9 17.9 — 17.9 Share-based compensation 15.7 — — — 15.7 — 15.7 Dividends declared ($1.06 per share) — (61.4 ) — — (61.4 ) — (61.4 ) Treasury share purchases — — (256.8 ) — (256.8 ) — (256.8 ) Treasury share issuances (8.6 ) — 13.2 — 4.6 — 4.6 Acquisition of remaining noncontrolling interest in Gavita (5.7 ) — — — (5.7 ) (7.9 ) (13.6 ) Balance at March 31, 2018 $ 409.0 $ 1,044.5 $ (911.4 ) $ (51.3 ) $ 490.8 $ 5.1 $ 495.9 Accumulated Other Comprehensive Loss During the three months ended March 31, 2018 , the Company repatriated cash from a foreign subsidiary resulting in the liquidation of substantially all of the assets of the subsidiary and the write-off of accumulated foreign currency translation loss adjustments of $11.7 million within the “Other non-operating expense, net” line in the Condensed Consolidated Statements of Operations. Share Repurchases 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 up to $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 March 31, 2018 , Scotts Miracle-Gro repurchased 1.7 million and 2.7 million Common Shares for $160.2 million and $256.8 million , respectively. From the inception of this share repurchase program in the fourth quarter of fiscal 2014 through March 31, 2018 , Scotts Miracle-Gro repurchased approximately 7.5 million Common Shares for $648.3 million . Exercise of Outstanding AeroGrow Warrants 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 $40.5 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 of Scotts Miracle-Gro. 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 October 30, 2017, the Company issued 0.2 million upfront performance-based award units, covering a four -year performance period, with an estimated fair value of $20.2 million on the date of grant to certain Hawthorne segment employees as part of its Project Focus initiative. These awards vest after approximately four years subject to the achievement of specific performance goals aligned with the strategic objectives of the Company’s Project Focus initiatives. Based on the extent to which the performance goals are achieved, vested shares may range from 50 to 250 percent of the target award amount. The performance goals are based on cumulative Hawthorne non-GAAP adjusted earnings. 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 MARCH 31, APRIL 1, Employees Restricted stock units 109,563 102,143 Performance units 235,503 487,674 Board of Directors Deferred stock units 20,799 22,902 Total share-based awards 365,865 612,719 Aggregate fair value at grant dates (in millions) $ 34.9 $ 56.9 Total share-based compensation was as follows for each of the periods indicated: THREE MONTHS ENDED SIX MONTHS ENDED MARCH 31, APRIL 1, MARCH 31, APRIL 1, (In millions) Share-based compensation $ 9.7 $ 12.8 $ 15.7 $ 15.1 Tax benefit recognized 1.8 4.9 4.1 5.8 Stock Options Aggregate stock option activity was as follows: No. of Options Wtd. Avg. Exercise Price Awards outstanding at September 30, 2017 1,517,310 $ 53.05 Granted — — Exercised (72,027 ) 50.38 Forfeited (1,367 ) 36.86 Awards outstanding at March 31, 2018 1,443,916 53.20 Exercisable 1,017,603 $ 46.72 At March 31, 2018 , the total pre-tax compensation cost, net of estimated forfeitures, related to nonvested stock options not yet recognized was $0.6 million , which is expected to be recognized over a weighted-average period of 0.8 years. The intrinsic value of stock options exercised for the six months ended March 31, 2018 was $3.8 million . At March 31, 2018 , the Company expects 0.4 million of the remaining unexercisable stock options (after forfeitures), with a weighted-average exercise price of $68.65 , intrinsic value of $7.1 million and average remaining term of 7.8 , to vest in the future. The following summarizes certain information pertaining to stock option awards outstanding and exercisable at March 31, 2018 (options in millions): Awards Outstanding Awards Exercisable Range of Exercise Price 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 0.2 0.51 $ 20.59 0.2 0.51 $ 20.59 $38.81 – $49.19 0.4 2.93 45.22 0.4 2.93 45.22 $63.43 – $68.68 0.8 7.36 66.26 0.4 6.84 63.49 1.4 5.02 $ 53.20 1.0 3.84 $ 46.72 The intrinsic values of the stock option awards outstanding and exercisable at March 31, 2018 were as follows (in millions): Outstanding $ 47.0 Exercisable 39.7 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, 2017 291,519 $ 81.15 Granted 130,362 90.86 Vested (86,601 ) 67.70 Forfeited — — Awards outstanding at March 31, 2018 335,280 $ 88.39 At March 31, 2018 , the total pre-tax compensation cost, net of estimated forfeitures, related to nonvested restricted share units not yet recognized was $8.3 million , which is expected to be recognized over a weighted-average period of 1.9 years. 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, 2017 596,933 $ 88.01 Granted 235,503 97.72 Vested (53,644 ) 63.43 Forfeited (3,037 ) 98.81 Awards outstanding at March 31, 2018 775,755 $ 92.61 At March 31, 2018 , the total pre-tax compensation cost, net of estimated forfeitures, related to nonvested performance-based units not yet recognized was $28.0 million , which is expected to be recognized over a weighted-average period of 3.3 years. |
INCOME TAXES
INCOME TAXES | 6 Months Ended |
Mar. 31, 2018 | |
Income Tax Disclosure [Abstract] | |
INCOME TAXES | INCOME TAXES On December 22, 2017, H.R.1 (the “Act,” formerly known as the “Tax Cuts and Jobs Act”) was signed into law and provides for significant changes to the U.S. Internal Revenue Code of 1986, as amended (the “Code”). The Act has widespread applicability to companies, including impacting corporate tax rates, business-related exclusions, deduction and credits, and international taxability. Among other items important to the Company, the Act implements a territorial tax system, imposes a one-time transition tax on deemed repatriated earnings of foreign subsidiaries, and permanently reduces the federal corporate tax rate to 21% effective January 1, 2018. As the Company’s fiscal year end falls on September 30, the statutory federal corporate tax rate for fiscal 2018 will be prorated to 24.5% , with the statutory rate for fiscal 2019 and beyond at 21% . The effective tax rates related to continuing operations for the six months ended March 31, 2018 and April 1, 2017 were (15.0)% and 35.7% , respectively. 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 and includes the impact of discrete items recognized in the quarter. 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. At September 30, 2017, the Company had a net deferred tax liability of $157.5 million . Under GAAP, the Company uses the asset and liability method of accounting for income taxes. Under this method, deferred tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax basis. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. The Company’s net deferred tax liability of $157.5 million was determined based on the current enacted federal tax rate of 35% prior to the passage of the Act. As a result of the reduction in the corporate income tax rate from 35% to 21% under the Act, the Company estimates the value of its net deferred tax liability has been reduced by $45.9 million , which has been recorded in the “Income tax expense (benefit) from continuing operations” line in the Condensed Consolidated Statement of Operations for the three and six months ended March 31, 2018 . The Company’s actual write-down may vary from the current estimate due to a number of uncertainties and factors, including the completion of the Company’s consolidated financial statements as of and for the year ending September 30, 2018, and further clarifications of the Act which cannot be anticipated at this time. In accordance with SAB 118, any necessary measurement adjustments will be recorded and disclosed within one year from the enactment date within the period the adjustments are determined. The Act also provides for a one-time transition tax on “deemed repatriation” of accumulated foreign earnings for the year ended September 30, 2018. The Company estimates U.S. federal tax on the deemed repatriation of $14.0 million . However, after the application of $10.7 million of foreign tax credits generated from the repatriation, plus utilization of $3.2 million of foreign tax credit carryovers previously reserved under a full valuation allowance, no cash payment is expected to be due. Additionally, state tax expense is expected to increase by $0.1 million as a result of the deemed repatriation in the current fiscal year. These amounts have been recorded in the “Income tax expense (benefit) from continuing operations” line in the Condensed Consolidated Statement of Operations for the three and six months ended March 31, 2018 . While the Company believes this is a reasonable estimate of the effects of the transition tax, it is subject to further analysis which cannot be completed until after the end of the fiscal year. The additional information and analysis may cause the actual liability to differ from the current estimate. In accordance with SAB 118, any necessary measurement adjustments will be recorded and disclosed within one year from the enactment date within the period the adjustments are determined. During the three months ended March 31, 2018 , the Company repatriated cash from a foreign subsidiary resulting in the liquidation of substantially all of the assets of the subsidiary and the write-off of accumulated foreign currency translation loss adjustments of $11.7 million within the “Other non-operating expense, net” line in the Condensed Consolidated Statements of Operations. The Company does not currently have the information necessary to determine a reasonable estimate of the current or deferred impacts of certain aspects of the Act including those related to executive compensation and international taxation that are not effective until the Company's fiscal year ended September 30, 2019. These include the potential impacts of the limitation on tax deductions for performance-based compensation of certain individuals and the so-called “Global Intangible Low-Tax Income (GILTI)” and “Foreign Derived Intangible Income (FDII)” per the Act. Because of the complexity of the new GILTI tax rules, the Company continues to evaluate this provision of the Act and the application of ASC 740. Under GAAP, the Company is permitted to make an accounting policy election of either (1) treating taxes due on future U.S. inclusions in taxable income related to GILTI as a current-period expense when incurred (the “period cost method”) or (2) factoring such amounts into a company’s measurement of its deferred taxes (the “deferred method”). The Company’s selection of an accounting policy with respect to the new GILTI tax rules will depend, in part, on analyzing its global income to determine whether it expects to have future U.S. inclusions in taxable income related to GILTI and, if so, what the impact is expected to be. Because whether the Company expects to have future U.S. inclusions in taxable income related to GILTI depends on not only its current structure and estimated future results of global operations but also its intent and ability to modify its structure and/or its business, the Company is not yet able to reasonably estimate the effect of this provision of the Act. Therefore, in accordance with SAB 118, the Company has not made any adjustments related to potential GILTI tax in its financial statements and has not made a policy election decision regarding whether to record deferred taxes on GILTI. Similarly, in accordance with SAB 118, the Company has not adjusted its current or deferred taxes for the tax effects of FDII or the limitation on tax deductions for performance-based compensation in the current period. Estimates of these amounts will be recorded in the first reporting period in which a reasonable estimate can be determined. 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 2014. The Company is currently under examination by certain U.S. state and local tax authorities. The tax periods under examination are limited to fiscal years 2011 through 2016 . During the second quarter of fiscal 2018, an IRS audit covering fiscal years 2011 through 2013 was effectively settled with no material impact to the consolidated financial statements. 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 |
Mar. 31, 2018 | |
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 accruals 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 accruals, 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 March 31, 2018 , $4.2 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. No accruals have been recorded in the Company’s consolidated financial statements as the likelihood of a loss is not probable at this time; and the Company does not believe a reasonably possible loss would be material to, nor the ultimate resolution of these cases will have a material adverse effect on, the Company’s financial condition, results of operations or cash flows. There can be no assurance that future developments related to pending claims or claims filed in the future, 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-AGS. 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. No accruals have been recorded in the Company’s consolidated financial statements as the likelihood of a loss is not probable at this time. There can be no assurance that future developments with respect to 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 has been named as a defendant in In re Scotts EZ Seed Litigation , Case No. 12-cv-4727 (VB), a New York and California class action lawsuit filed August 9, 2012 in the United States District Court for the Southern District of New York that asserts claims under false advertising and other legal theories based on a marketing statement on the Company’s EZ Seed grass seed product from 2009 to 2012. The plaintiffs seek, on behalf of themselves and purported class members, various forms of monetary and non-monetary relief, including statutory damages that they contend could amount to hundreds of millions of dollars. The Company has defended the action vigorously, and disputes the plaintiffs’ claims and theories, including the recoverability of statutory damages. In 2017, the Court eliminated certain claims, narrowed the case in certain respects, and permitted the case to continue proceeding as a class action. On August 7, 2017, the Court requested briefs on the Company’s request for interlocutory review of issues relating to the recoverability of statutory damages in a class action by the United States Court of Appeals for the Second Circuit and, on August 31, 2017, approved that request. On January 8, 2018, however, the Second Circuit denied the interlocutory appeal request. The parties engaged in mediation on April 9, 2018 and agreed in principle to a preliminary settlement of the outstanding claims on April 10, 2018. The preliminary settlement would require the Company to pay certain attorneys’ and administrative fees and provide certain payments to the class members. The preliminary settlement will not be finalized until after the court approves the settlement and a claims process determines the payments to be provided to the class members. During the three months ended March 31, 2018 , the Company recognized a charge of $10.2 million for a probable loss related to this matter within the “Impairment, restructuring and other” line in the Condensed Consolidated Statements of Operations. The resolution of the claims process may result in additional losses in excess of the amount accrued, however, the Company does not believe a reasonably possible loss in excess of the amount accrued would be material to, nor 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 |
Mar. 31, 2018 | |
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 March 31, 2018 , the notional amount of outstanding currency forward contracts was $252.9 million , with a negative fair value of $0.7 million . 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 September 30, 2017 , the notional amount of outstanding currency forward contracts was $268.3 million , with a fair value of $1.8 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 quarter. 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. 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 maximum total U.S. dollar equivalent notional amount of $1,300.0 million at March 31, 2018 , $1,150.0 million at April 1, 2017 and $1,100.0 million at September 30, 2017 . Refer to “NOTE 8. DEBT” for the terms of the swap agreements outstanding at March 31, 2018 . Included in the AOCI balance at March 31, 2018 was a gain of $0.9 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 March 31, 2018 was a loss of $0.3 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. 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 March 31, 2018 , there were no amounts included within AOCI. The Company had the following outstanding commodity contracts that were entered into to hedge forecasted purchases: COMMODITY MARCH 31, APRIL 1, SEPTEMBER 30, Urea 42,000 tons 28,500 tons 76,500 tons Diesel 3,360,000 gallons 5,544,000 gallons 5,586,000 gallons Heating Oil 1,092,000 gallons 1,680,000 gallons 1,386,000 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 MARCH 31, APRIL 1, SEPTEMBER 30, BALANCE SHEET LOCATION FAIR VALUE (In millions) Interest rate swap agreements Prepaid and other current assets $ 1.5 $ 0.7 $ 1.3 Other assets 1.9 0.8 — Other current liabilities — (1.9 ) (0.8 ) Other liabilities — (0.7 ) (0.4 ) Commodity hedging instruments Prepaid and other current assets — — 3.2 Other current liabilities (0.5 ) (0.2 ) — Total derivatives designated as hedging instruments $ 2.9 $ (1.3 ) $ 3.3 DERIVATIVES NOT DESIGNATED AS HEDGING INSTRUMENTS BALANCE SHEET LOCATION Currency forward contracts Prepaid and other current assets $ 0.3 $ 0.5 $ 2.0 Other current liabilities (1.0 ) (4.0 ) (0.2 ) Commodity hedging instruments Prepaid and other current assets 1.1 — 0.6 Other current liabilities — (0.1 ) — Total derivatives not designated as hedging instruments 0.4 (3.6 ) 2.4 Total derivatives $ 3.3 $ (4.9 ) $ 5.7 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 MARCH 31, APRIL 1, MARCH 31, APRIL 1, (In millions) Interest rate swap agreements $ 2.1 $ 0.4 $ 2.5 $ 2.5 Commodity hedging instruments (0.1 ) (0.4 ) 0.3 0.5 Total $ 2.0 $ — $ 2.8 $ 3.0 DERIVATIVES IN CASH FLOW HEDGING RELATIONSHIPS RECLASSIFIED FROM AOCI INTO STATEMENT OF OPERATIONS AMOUNT OF GAIN / (LOSS) THREE MONTHS ENDED SIX MONTHS ENDED MARCH 31, APRIL 1, MARCH 31, APRIL 1, (In millions) Interest rate swap agreements Interest expense $ 0.1 $ (0.9 ) $ 0.2 $ (1.2 ) Commodity hedging instruments Cost of sales 1.0 (0.2 ) 1.0 (0.3 ) Total $ 1.1 $ (1.1 ) $ 1.2 $ (1.5 ) DERIVATIVES NOT DESIGNATED AS HEDGING INSTRUMENTS RECOGNIZED IN STATEMENT OF OPERATIONS AMOUNT OF GAIN / (LOSS) THREE MONTHS ENDED SIX MONTHS ENDED MARCH 31, APRIL 1, MARCH 31, APRIL 1, (In millions) Currency forward contracts Other income / expense, net $ (2.6 ) $ (2.2 ) $ (5.2 ) $ 7.0 Commodity hedging instruments Cost of sales 0.2 (0.9 ) 1.5 — Total $ (2.4 ) $ (3.1 ) $ (3.7 ) $ 7.0 |
FAIR VALUE MEASUREMENTS
FAIR VALUE MEASUREMENTS | 6 Months Ended |
Mar. 31, 2018 | |
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 Company’s option to increase its economic interest in Bonnie Plants, Inc. (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 In connection with the acquisition of a controlling interest in Gavita during fiscal 2016, the Company recorded a loan to the noncontrolling ownership group of Gavita. On October 2, 2017 , the Company’s Hawthorne segment acquired the remaining 25% noncontrolling interest in Gavita, which included extinguishment of the loan to the noncontrolling ownership group of Gavita with a fair value and carrying value of $55.6 million . The fair value of the loan was $37.2 million and $55.6 million at April 1, 2017 and September 30, 2017 , respectively. The estimate required subjective assumptions to be made, including those related to future business results and discount rates. The fair value measurement was based on significant inputs unobservable in the market and thus represented a Level 3 measurement. The following table presents the Company’s financial assets and liabilities measured at fair value on a recurring basis at March 31, 2018 : 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 $ 0.9 $ — $ — $ 0.9 Derivatives Interest rate swap agreements — 3.4 — 3.4 Currency forward contracts — 0.3 — 0.3 Commodity hedging instruments — 1.1 — 1.1 Other 18.0 — 11.8 29.8 Total $ 18.9 $ 4.8 $ 11.8 $ 35.5 Liabilities Derivatives Currency forward contracts $ — $ (1.0 ) $ — $ (1.0 ) Commodity hedging instruments — (0.5 ) — (0.5 ) Total $ — $ (1.5 ) $ — $ (1.5 ) 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 September 30, 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 $ 26.2 $ — $ — $ 26.2 Derivatives Interest rate swap agreements — 1.3 — 1.3 Currency forward contracts — 2.0 — 2.0 Commodity hedging instruments — 3.8 — 3.8 Other 15.7 — 11.8 27.5 Total $ 41.9 $ 7.1 $ 11.8 $ 60.8 Liabilities Derivatives Interest rate swap agreements $ — $ (1.2 ) $ — $ (1.2 ) Currency forward contracts — (0.2 ) — (0.2 ) Long-term debt — — (55.6 ) (55.6 ) Total $ — $ (1.4 ) $ (55.6 ) $ (57.0 ) |
SEGMENT INFORMATION
SEGMENT INFORMATION | 6 Months Ended |
Mar. 31, 2018 | |
Segment Reporting [Abstract] | |
SEGMENT INFORMATION | SEGMENT INFORMATION The Company divides its business into three reportable segments: U.S. Consumer, Hawthorne and Other. U.S. Consumer consists of the Company’s consumer lawn and garden business located in the geographic United States. Hawthorne consists of the Company’s indoor, urban and hydroponic gardening business. Other consists of the Company’s consumer lawn and garden business in geographies other than the U.S. and the Company’s product sales to commercial nurseries, greenhouses and other professional customers. Corporate consists of general and administrative expenses and certain other income/expense items not allocated to the business segments. This identification of reportable segments is consistent with how the segments report to and are managed by the chief operating decision maker of the Company. These segments differ from those used in prior periods due to the change in the Company’s internal organizational structure resulting from the Company’s divestiture of the International Business on August 31, 2017. As a result, effective in its fourth quarter of fiscal 2017, the Company classified its results of operations for all periods presented to reflect the International Business as a discontinued operation and classified the assets and liabilities of the International Business as held for sale. The prior period amounts have been reclassified to conform with the new segments. 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 financial information for the Company’s reportable segments for the periods indicated: THREE MONTHS ENDED SIX MONTHS ENDED MARCH 31, APRIL 1, MARCH 31, APRIL 1, (In millions) Net sales: U.S. Consumer $ 920.2 $ 974.8 $ 1,046.1 $ 1,101.0 Hawthorne 41.8 59.1 118.5 122.8 Other 51.3 50.7 70.3 68.2 Consolidated $ 1,013.3 $ 1,084.6 $ 1,234.9 $ 1,292.0 Segment Profit (Loss): U.S. Consumer $ 286.2 $ 313.9 $ 248.3 $ 275.4 Hawthorne (4.8 ) 9.6 (3.0 ) 16.3 Other 1.6 3.8 (2.5 ) 1.5 Total Segment Profit (Loss) 283.0 327.3 242.8 293.2 Corporate (33.6 ) (35.4 ) (58.7 ) (57.8 ) Intangible asset amortization (6.9 ) (5.6 ) (13.7 ) (11.1 ) Impairment, restructuring and other (10.2 ) (1.0 ) (10.0 ) (0.8 ) Equity in income (loss) of unconsolidated affiliates 1.5 (24.1 ) 2.1 (37.3 ) Interest expense (22.6 ) (21.5 ) (40.4 ) (36.8 ) Other non-operating expense, net (9.2 ) — (6.7 ) — Income from continuing operations before income taxes $ 202.0 $ 239.7 $ 115.4 $ 149.4 MARCH 31, APRIL 1, SEPTEMBER 30, (In millions) Total assets: U.S. Consumer $ 2,487.6 $ 2,569.4 $ 1,650.3 Hawthorne 664.4 502.3 648.0 Other 213.7 209.9 150.7 Corporate 209.8 178.9 298.0 Assets held for sale — 331.5 — Consolidated $ 3,575.5 $ 3,792.0 $ 2,747.0 |
SUBSEQUENT EVENT
SUBSEQUENT EVENT | 6 Months Ended |
Mar. 31, 2018 | |
Subsequent Events [Abstract] | |
Subsequent Event | SUBSEQUENT EVENT On April 12, 2018, Hawthorne Hydroponics LLC (the “Buyer”), a subsidiary of the Company, entered into a purchase agreement (the “Purchase Agreement”) to purchase (i) substantially all of the assets and certain specified liabilities of Sunlight Supply, Inc., Sunlight Garden Supply, Inc., Sunlight Garden Supply, ULC, and IP Holdings, LLC (together, with Craig R. Hargreaves and Kim E. Hargreaves, the “Sellers”) and (ii) all of the issued and outstanding equity interests of Columbia River Industrial Holdings, LLC (the “Transaction”). The Sellers are engaged in the business of developing, manufacturing, marketing and distributing horticultural, organics, lighting and hydroponics products, including, without limitation, lighting fixtures, nutrients, seeds and growing media, systems, trays, fans, filters, humidifiers and dehumidifiers, timers, instruments, water pumps, irrigation supplies and hand tools (the “Business”). Prior to the execution of the Purchase Agreement, Sunlight Supply, Inc. served as a non-exclusive distributor of the Buyer. Under the terms and conditions of the Purchase Agreement, upon closing of the Transaction, the Company would pay $450.0 million , consisting of $425.0 million in cash and $25.0 million in common stock of the Company (the “Company Shares”). Up to an additional $20.0 million would be paid by the Company contingent on the achievement of certain performance metrics of the Company following the closing of the Transaction. The parties’ obligations to consummate the Transaction include customary closing conditions, including, receipt of required governmental approvals, as well as, among other things, (i) the requirement that certain employees (a) complete background screening procedures, (b) accept the Buyer’s offer of employment and (c) complete and sign the Buyer’s on-boarding documents for employment, (ii) a limited due diligence condition in favor of the Buyer, and (iii) the delivery of certain ancillary agreements, including lease agreements with respect to the Sellers’ affiliated real property leases. On May 2, 2018, the Federal Trade Commission granted an early termination of the HSR waiting period with respect to the Transaction, and as of the date of this filing, the other conditions are in varying stages of completion. The Purchase Agreement also includes customary representations, warranties and covenants. Among other things, the Sellers (i) make certain representations related to product registrations and permits related to the Business and (ii) have agreed to (a) certain customary restrictions on the conduct of the Business prior to the closing date, (b) not to compete with the Business or solicit employees or customers of the Business for five years following the closing date, and (c) maintain product registrations that are related to the Business. The parties have agreed to (x) cooperate to undertake all actions necessary to obtain the necessary antitrust consents and approvals and (y) not engage in or continue any negotiations regarding other business combination transactions, provided that such restriction on the Buyer is limited to certain specified entities. The Purchase Agreement permits either party the right to terminate the Purchase Agreement in certain circumstances, including in the event of breach or failure to perform certain covenants or if the Transaction has not been consummated by October 12, 2018, subject to an automatic extension to December 31, 2018 and a discretionary extension by the Buyer for three months thereafter in the event all necessary antitrust consents and approvals have not yet been obtained. As noted above, On May 2, 2018, the Federal Trade Commission granted an early termination of the HSR waiting period with respect to the Transaction. |
FINANCIAL INFORMATION FOR SUBSI
FINANCIAL INFORMATION FOR SUBSIDIARY GUARANTORS AND NON-GUARANTORS | 6 Months Ended |
Mar. 31, 2018 | |
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. 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. The following 100% directly or indirectly owned subsidiaries fully and unconditionally guarantee at March 31, 2018 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 1, 2017, American Agritech, L.L.C. was merged into Hawthorne Hydroponics LLC, and has been classified as a Guarantor for all periods presented. The following information presents Condensed Consolidating Statements of Operations for the three and six months ended March 31, 2018 and April 1, 2017 , Condensed Consolidating Statements of Comprehensive Income (Loss) for the three and six months ended March 31, 2018 and April 1, 2017 , Condensed Consolidating Statements of Cash Flows for the six months ended March 31, 2018 and April 1, 2017 , and Condensed Consolidating Balance Sheets as of March 31, 2018 , April 1, 2017 and September 30, 2017 . 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 March 31, 2018 and April 1, 2017 are $554.0 million and $351.5 million , respectively, of dividends paid by the Guarantors and Non-Guarantors to the Parent representing return of investments and as such are classified within cash flows from investing activities. Included in the Parent Condensed Consolidating Statement of Cash Flows for the six months ended March 31, 2018 are $12.2 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 March 31, 2018 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated Net sales $ — $ 951.9 $ 61.4 $ — $ 1,013.3 Cost of sales — 555.6 48.5 — 604.1 Gross profit — 396.3 12.9 — 409.2 Operating expenses: Selling, general and administrative — 150.1 15.6 0.3 166.0 Impairment, restructuring and other — 10.2 — — 10.2 Other (income) expense, net (0.2 ) 0.9 — — 0.7 Income (loss) from operations 0.2 235.1 (2.7 ) (0.3 ) 232.3 Equity (income) loss in subsidiaries (158.9 ) 3.8 — 155.1 — Equity in (income) loss of unconsolidated affiliates — — (1.5 ) — (1.5 ) Interest expense 20.9 13.1 1.3 (12.7 ) 22.6 Other non-operating (income) expense, net (7.9 ) (2.5 ) 6.9 12.7 9.2 Income (loss) from continuing operations before income taxes 146.1 220.7 (9.4 ) (155.4 ) 202.0 Income tax expense (benefit) from continuing operations (3.1 ) 54.7 (2.3 ) — 49.3 Income (loss) from continuing operations 149.2 166.0 (7.1 ) (155.4 ) 152.7 Income (loss) from discontinued operations, net of tax — (3.7 ) — — (3.7 ) Net income (loss) $ 149.2 $ 162.3 $ (7.1 ) $ (155.4 ) $ 149.0 Net (income) loss attributable to noncontrolling interest — — — (0.1 ) (0.1 ) Net income (loss) attributable to controlling interest $ 149.2 $ 162.3 $ (7.1 ) $ (155.5 ) $ 148.9 THE SCOTTS MIRACLE-GRO COMPANY Condensed Consolidating Statement of Operations for the six months ended March 31, 2018 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated Net sales $ — $ 1,099.5 $ 135.4 $ — $ 1,234.9 Cost of sales — 682.6 109.1 — 791.7 Gross profit — 416.9 26.3 — 443.2 Operating expenses: Selling, general and administrative — 240.5 33.0 0.7 274.2 Impairment, restructuring and other — 10.0 — — 10.0 Other (income) expense, net (0.4 ) (0.2 ) (0.8 ) — (1.4 ) Income (loss) from operations 0.4 166.6 (5.9 ) (0.7 ) 160.4 Equity (income) loss in subsidiaries (157.8 ) 5.5 — 152.3 — Equity in (income) loss of unconsolidated affiliates — — (2.1 ) — (2.1 ) Interest expense 37.8 21.8 2.2 (21.4 ) 40.4 Other non-operating (income) expense, net (11.8 ) (5.0 ) 2.1 21.4 6.7 Income (loss) from continuing operations before income taxes 132.2 144.3 (8.1 ) (153.0 ) 115.4 Income tax expense (benefit) from continuing operations 3.8 (22.4 ) 1.3 — (17.3 ) Income (loss) from continuing operations 128.4 166.7 (9.4 ) (153.0 ) 132.7 Income (loss) from discontinued operations, net of tax — (3.9 ) (1.0 ) — (4.9 ) Net income (loss) $ 128.4 $ 162.8 $ (10.4 ) $ (153.0 ) $ 127.8 Net (income) loss attributable to noncontrolling interest — — — (0.1 ) (0.1 ) Net income (loss) attributable to controlling interest $ 128.4 $ 162.8 $ (10.4 ) $ (153.1 ) $ 127.7 THE SCOTTS MIRACLE-GRO COMPANY Condensed Consolidating Statement of Comprehensive Income (Loss) for the three months ended March 31, 2018 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated Net income (loss) $ 149.2 $ 162.3 $ (7.1 ) $ (155.4 ) $ 149.0 Other comprehensive income (loss), net of tax: Net foreign currency translation adjustment 15.8 — 15.8 (15.8 ) 15.8 Net change in derivatives 0.9 (1.1 ) — 1.1 0.9 Net change in pension and other post-retirement benefits 0.3 0.1 0.2 (0.3 ) 0.3 Total other comprehensive income (loss) 17.0 (1.0 ) 16.0 (15.0 ) 17.0 Comprehensive income (loss) $ 166.2 $ 161.3 $ 8.9 $ (170.4 ) $ 166.0 THE SCOTTS MIRACLE-GRO COMPANY Condensed Consolidating Statement of Comprehensive Income (Loss) for the six months ended March 31, 2018 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated Net income (loss) $ 128.4 $ 162.8 $ (10.4 ) $ (153.0 ) $ 127.8 Other comprehensive income (loss), net of tax: Net foreign currency translation adjustment 15.7 — 15.7 (15.7 ) 15.7 Net change in derivatives 1.6 (0.7 ) — 0.7 1.6 Net change in pension and other post-retirement benefits 0.6 0.2 0.4 (0.6 ) 0.6 Total other comprehensive income (loss) 17.9 (0.5 ) 16.1 (15.6 ) 17.9 Comprehensive income (loss) $ 146.3 $ 162.3 $ 5.7 $ (168.6 ) $ 145.7 THE SCOTTS MIRACLE-GRO COMPANY Condensed Consolidating Statement of Cash Flows for the six months ended March 31, 2018 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES (a) $ 9.5 $ (503.5 ) $ 25.2 $ (14.0 ) $ (482.8 ) INVESTING ACTIVITIES (a) Proceeds from sale of long-lived assets — 0.2 — — 0.2 Post-closing working capital payment related to sale of International Business — (35.3 ) — — (35.3 ) Investments in property, plant and equipment — (29.8 ) (3.3 ) — (33.1 ) Investments in loans receivable — (7.4 ) (0.3 ) — (7.7 ) Investments in acquired businesses, net of cash acquired — (40.5 ) (103.7 ) — (144.2 ) Return of investments from affiliates 554.0 — — (554.0 ) — Investing cash flows from (to) affiliates (250.2 ) (70.2 ) (80.0 ) 400.4 — Net cash provided by (used in) investing activities 303.8 (183.0 ) (187.3 ) (153.6 ) (220.1 ) FINANCING ACTIVITIES Borrowings under revolving and bank lines of credit and term loans — 1,032.9 139.7 — 1,172.6 Repayments under revolving and bank lines of credit and term loans — (154.8 ) (88.6 ) — (243.4 ) Dividends paid (60.3 ) (554.0 ) (14.0 ) 568.0 (60.3 ) Purchase of Common Shares (256.8 ) — — — (256.8 ) Payments on seller notes — — (3.0 ) — (3.0 ) Cash received from the exercise of stock options 3.8 — — — 3.8 Financing cash flows from (to) affiliates — 330.2 70.2 (400.4 ) — Net cash provided by (used in) financing activities (313.3 ) 654.3 104.3 167.6 612.9 Effect of exchange rate changes on cash — — 2.5 — 2.5 Net increase (decrease) in cash and cash equivalents — (32.2 ) (55.3 ) — (87.5 ) Cash and cash equivalents at beginning of period — 39.8 80.7 — 120.5 Cash and cash equivalents at end of period $ — $ 7.6 $ 25.4 $ — $ 33.0 (a) Cash received by the Parent from the Guarantors and Non-Guarantors in the form of dividends in the amount of $554.0 million represent return of investments and are included in cash flows from investing activities. Cash received by the Parent from the Guarantors and Non-Guarantors in the form of dividends in the amount of $12.2 million represent return on investments and are included in cash flows from operating activities. Cash received by the Guarantors from the Non-Guarantors in the form of dividends in the amount of $1.8 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 March 31, 2018 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated ASSETS Current assets: Cash and cash equivalents $ — $ 7.6 $ 25.4 $ — $ 33.0 Accounts receivable, net — 533.0 65.0 — 598.0 Accounts receivable pledged — 333.3 — — 333.3 Inventories — 495.5 101.4 — 596.9 Prepaid and other current assets 1.7 55.0 21.4 — 78.1 Total current assets 1.7 1,424.4 213.2 — 1,639.3 Investment in unconsolidated affiliates — — 33.2 — 33.2 Property, plant and equipment, net — 399.8 63.8 — 463.6 Goodwill — 323.0 132.2 11.6 466.8 Intangible assets, net — 633.9 135.6 8.1 777.6 Other assets 8.7 171.1 15.2 — 195.0 Equity investment in subsidiaries 1,287.1 — — (1,287.1 ) — Intercompany assets 1,163.1 304.0 — (1,467.1 ) — Total assets $ 2,460.6 $ 3,256.2 $ 593.2 $ (2,734.5 ) $ 3,575.5 LIABILITIES AND EQUITY Current liabilities: Current portion of debt $ 15.0 $ 317.7 $ 18.1 $ (15.0 ) $ 335.8 Accounts payable — 222.6 30.9 — 253.5 Other current liabilities 17.2 265.5 34.1 — 316.8 Total current liabilities 32.2 805.8 83.1 (15.0 ) 906.1 Long-term debt 1,936.6 1,166.8 128.8 (1,294.5 ) 1,937.7 Distributions in excess of investment in unconsolidated affiliate — 21.9 — — 21.9 Other liabilities 1.0 148.1 59.8 5.0 213.9 Equity investment in subsidiaries — 69.3 — (69.3 ) — Intercompany liabilities — — 134.9 (134.9 ) — Total liabilities 1,969.8 2,211.9 406.6 (1,508.7 ) 3,079.6 Total equity—controlling interest 490.8 1,044.3 186.6 (1,230.9 ) 490.8 Noncontrolling interest — — — 5.1 5.1 Total equity 490.8 1,044.3 186.6 (1,225.8 ) 495.9 Total liabilities and equity $ 2,460.6 $ 3,256.2 $ 593.2 $ (2,734.5 ) $ 3,575.5 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 $ 85.8 $ — $ 1,084.6 Cost of sales — 558.5 61.8 — 620.3 Gross profit — 440.3 24.0 — 464.3 Operating expenses: Selling, general and administrative — 160.3 18.1 0.4 178.8 Impairment, restructuring and other — 1.0 — — 1.0 Other (income) expense, net (0.2 ) (1.1 ) 0.5 — (0.8 ) Income (loss) from operations 0.2 280.1 5.4 (0.4 ) 285.3 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 161.0 253.0 8.2 (182.5 ) 239.7 Income tax expense (benefit) from continuing operations (4.6 ) 86.9 3.3 — 85.6 Income (loss) from continuing operations 165.6 166.1 4.9 (182.5 ) 154.1 Income (loss) from discontinued operations, net of tax — 1.1 10.0 — 11.1 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 $ 147.7 $ — $ 1,292.0 Cost of sales — 685.0 105.9 — 790.9 Gross profit — 459.3 41.8 — 501.1 Operating expenses: Selling, general and administrative — 247.1 35.1 0.7 282.9 Impairment, restructuring and other — 0.8 — — 0.8 Other (income) expense, net (0.4 ) (6.4 ) 0.7 — (6.1 ) Income (loss) from operations 0.4 217.8 6.0 (0.7 ) 223.5 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 1.9 (21.7 ) 36.8 Income (loss) from continuing operations before income taxes 92.3 166.3 13.9 (123.1 ) 149.4 Income tax expense (benefit) from continuing operations (8.2 ) 56.4 5.2 — 53.4 Income (loss) from continuing operations 100.5 109.9 8.7 (123.1 ) 96.0 Income (loss) from discontinued operations, net of tax — 0.1 4.2 — 4.3 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 $ (8.2 ) $ (386.6 ) $ (94.2 ) $ — $ (489.0 ) 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 ) Net (investments in) distributions from 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 to noncontrolling interest — — (40.5 ) 32.4 (8.1 ) Purchase of Common Shares (99.2 ) — — — (99.2 ) 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 92.8 658.4 198.9 (329.1 ) 621.0 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 excluding cash classified within assets held for sale — 2.7 25.9 — 28.6 Cash and cash equivalents at beginning of period classified within assets held for sale — — 21.5 — 21.5 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 $ 49.9 $ — $ 55.4 Accounts receivable, net — 900.8 77.5 — 978.3 Inventories — 500.7 95.8 — 596.5 Assets held for sale — — 331.5 — 331.5 Prepaid and other current assets 0.7 47.4 37.6 — 85.7 Total current assets 0.7 1,454.4 592.3 — 2,047.4 Investment in unconsolidated affiliates — 59.1 0.8 — 59.9 Property, plant and equipment, net — 385.8 51.3 — 437.1 Goodwill — 262.9 126.1 11.6 400.6 Intangible assets, net — 554.2 163.1 9.5 726.8 Other assets 10.7 107.8 2.1 (0.4 ) 120.2 Equity investment in subsidiaries 938.7 — — (938.7 ) — Intercompany assets 1,778.4 — — (1,778.4 ) — Total assets $ 2,728.5 $ 2,824.2 $ 935.7 $ (2,696.4 ) $ 3,792.0 LIABILITIES AND EQUITY Current liabilities: Current portion of debt $ 15.0 $ 15.8 $ 16.3 $ (15.0 ) $ 32.1 Accounts payable — 240.6 30.2 — 270.8 Liabilities held for sale — — 154.7 — 154.7 Other current liabilities 17.8 260.7 39.6 — 318.1 Total current liabilities 32.8 517.1 240.8 (15.0 ) 775.7 Long-term debt 2,016.1 1,288.2 114.0 (1,375.4 ) 2,042.9 Other liabilities 0.7 224.7 51.9 4.7 282.0 Equity investment in subsidiaries — 31.5 — (31.5 ) — Intercompany liabilities — 45.3 326.1 (371.4 ) — Total liabilities 2,049.6 2,106.8 732.8 (1,788.6 ) 3,100.6 Total equity—controlling interest 678.9 717.4 202.9 (920.3 ) 678.9 Noncontrolling interest — — — 12.5 12.5 Total equity 678.9 717.4 202.9 (907.8 ) 691.4 Total liabilities and equity $ 2,728.5 $ 2,824.2 $ 935.7 $ (2,696.4 ) $ 3,792.0 THE SCOTTS MIRACLE-GRO COMPANY Condensed Consolidating Balance Sheet As of September 30, 2017 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated ASSETS Current assets: Cash and cash equivalents $ — $ 39.8 $ 80.7 $ — $ 120.5 Accounts receivable, net — 137.6 60.1 — 197.7 Accounts receivable pledged — 88.9 — — 88.9 Inventories — 314.0 93.5 — 407.5 Prepaid and other current assets 1.3 43.4 22.4 — 67.1 Total current assets 1.3 623.7 256.7 — 881.7 Investment in unconsolidated affiliates — — 31.1 — 31.1 Property, plant and equipment, net — 406.4 61.3 — 467.7 Goodwill — 320.7 109.3 11.6 441.6 Intangible assets, net — 606.3 133.8 8.8 748.9 Other assets 8.1 158.3 9.6 — 176.0 Equity investment in subsidiaries 1,112.8 — — (1,112.8 ) — Intercompany assets 759.7 — — (759.7 ) — Total assets $ 1,881.9 $ 2,115.4 $ 601.8 $ (1,852.1 ) $ 2,747.0 LIABILITIES AND EQUITY Current liabilities: Current portion of debt $ 15.0 $ 97.8 $ 45.3 $ (15.0 ) $ 143.1 Accounts payable — 124.9 28.2 — 153.1 Other current liabilities 17.1 191.5 39.7 — 248.3 Total current liabilities 32.1 414.2 113.2 (15.0 ) 544.5 Long-term debt 1,200.7 508.6 108.0 (559.3 ) 1,258.0 Distributions in excess of investment in unconsolidated affiliate — 21.9 — — 21.9 Other liabilities 0.3 197.4 58.2 5.0 260.9 Equity investment in subsidiaries — 82.6 — (82.6 ) — Intercompany liabilities — 17.1 152.7 (169.8 ) — Total liabilities 1,233.1 1,241.8 432.1 (821.7 ) 2,085.3 Total equity—controlling interest 648.8 873.6 169.7 (1,043.3 ) 648.8 Noncontrolling interest — — — 12.9 12.9 Total equity 648.8 873.6 169.7 (1,030.4 ) 661.7 Total liabilities and equity $ 1,881.9 $ 2,115.4 $ 601.8 $ (1,852.1 ) $ 2,747.0 |
SUMMARY OF SIGNIFICANT ACCOUN26
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Policies) | 6 Months Ended |
Mar. 31, 2018 | |
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 March 31, 2018 and April 1, 2017 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”), in which the Company has a controlling interest, is 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) loss 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 in operating expenses in the Condensed Consolidated Statements of Operations. Interest income is recorded on an accrual basis. For the three and six months ended March 31, 2018 , the Company has classified interest income on loans receivable of $2.5 million and $5.0 million , respectively, in the “Other non-operating expense, net” line in the Condensed Consolidated Statements of Operations. For the three and six months ended April 1, 2017 , interest income on loans receivable of $2.1 million and $4.8 million , respectively, is classified in the “Other (income) expense, 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. |
Recently Adopted & Issued Accounting Pronouncements | RECENTLY ADOPTED ACCOUNTING PRONOUNCEMENTS Income Taxes On December 22, 2017, H.R.1 (the “Act,” formerly known as the “Tax Cuts and Jobs Act”) was signed into law and provides for significant changes to the U.S. Internal Revenue Code of 1986, as amended (the “Code”). Among other items, the Act implements a territorial tax system, imposes a one-time transition tax on deemed repatriated earnings of foreign subsidiaries, and permanently reduces the federal corporate tax rate to 21% effective January 1, 2018. Additionally, the SEC released Staff Accounting Bulletin No. 118 (“SAB 118”) which provides guidance on accounting for the Act’s impact under Accounting Standards Codification (“ASC”) Topic 740, Income Taxes (“ASC 740”). The guidance in SAB 118 addresses certain fact patterns where the accounting for changes in tax laws or tax rates under ASC 740 is incomplete upon issuance of an entity's financial statements for the reporting period in which the Act is enacted. Under the staff guidance in SAB 118, in the financial reporting period in which the Act is enacted, the income tax effects of the Act (i.e., only for those tax effects in which the accounting under ASC 740 is incomplete) would be reported as a provisional amount based on a reasonable estimate (to the extent a reasonable estimate can be determined), which would be subject to adjustment during a “measurement period” until the accounting under ASC 740 is complete. The measurement period is limited to no more than one year beyond the enactment date under the staff's guidance. SAB 118 also describes supplemental disclosures that should accompany the provisional amounts, including the reasons for the incomplete accounting, the additional information or analysis that is needed, and other information relevant to why the registrant was not able to complete the accounting required under ASC 740 in a timely manner. For discussion of the impacts of the Act that are material to the Company and required disclosures related to the Act pursuant to the guidance provided under SAB 118, refer to “NOTE 11. INCOME TAXES.” Share-Based Compensation In March 2016, the Financial Accounting Standards Board (“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 Company adopted this guidance effective October 1, 2017. The impact resulting from the adoption of this amended guidance is summarized below. The amended accounting guidance requires all excess tax benefits and tax deficiencies to be recognized as income tax benefit or expense on a prospective basis in the period of adoption. The adoption of this provision of the amended accounting guidance resulted in the recognition of excess tax benefits of $1.5 million and $1.9 million in the “Income tax expense (benefit) from continuing operations” line in the Condensed Consolidated Statement of Operations for the three and six months ended March 31, 2018 , respectively. As the Company adopted the guidance on a prospective basis, prior year activity has not been adjusted to conform with the current presentation and excess tax benefits of $3.2 million and $4.0 million have been recognized in the “Capital in excess of stated value” line within “Total equity—controlling interest” in the Condensed Consolidated Balance Sheets for the three and six months ended April 1, 2017 , respectively. The amended accounting guidance requires excess tax benefits to be classified as an operating activity in the statement of cash flows. Previously, excess tax benefits were presented as a cash inflow from financing activities and cash outflow from operating activities. The Company has elected to present these changes on a prospective basis and therefore the six months ended April 1, 2017 has not been adjusted to conform with the current presentation. The amended accounting guidance requires cash paid to a tax authority when shares are withheld to satisfy statutory income tax withholding obligations to be classified as a financing activity in the statement of cash flows. The Company’s retrospective adoption of this provision of the amended accounting guidance resulted in the classification of payments of $2.9 million and $8.8 million as cash outflows from financing activities for the six months ended March 31, 2018 and April 1, 2017 , respectively. The Company has elected to continue to estimate the number of awards expected to vest, as permitted by the amended accounting guidance, rather than electing to account for forfeitures as they occur. Derivatives and Hedging In August 2017, the FASB issued an accounting standard update that modifies hedge accounting by making more hedge strategies eligible for hedge accounting, amending presentation and disclosure requirements, and changing how companies assess effectiveness. The intent is to simplify application of hedge accounting and increase transparency of information about an entity’s risk management activities. The Company early adopted this guidance effective October 1, 2017. The adoption of this guidance did not have a significant impact on the Company’s consolidated financial position, results of operations or 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 Company adopted this guidance on a prospective basis effective October 1, 2017. The adoption of this guidance did not 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 Company adopted this guidance on a retrospective basis during the fourth quarter of fiscal 2017. As a result, deferred tax assets totaling $43.1 million have been presented net within other liabilities in the Condensed Consolidated Balance Sheet as of April 1, 2017 . This amount was previously reported within prepaid and other current assets. RECENTLY ISSUED ACCOUNTING PRONOUNCEMENTS 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 standard involves a five-step process that includes identifying the contract with the customer, identifying the performance obligations in the contract, determining the transaction price, allocating the transaction price to the performance obligations in the contract and recognizing revenue when the entity satisfies the performance obligations. 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 Company has made progress on its evaluation of the amended guidance, including identification of revenue streams and customer contract reviews. The Company is applying the five-step model to those contracts and revenue streams to evaluate the quantitative and qualitative impacts the new standard will have on its business and reported revenues. The provisions are effective for the Company in the first quarter of fiscal 2019 and the Company expects to adopt under the modified retrospective approach, which recognizes the cumulative effect of adoption as an adjustment to retained earnings at the date of initial application. The Company’s revenue is primarily product sales, which are recognized at a point in time when title transfers to customers and the Company has no further obligation to provide services related to such products. Although the Company is continuing to assess the impact of the amended guidance, it generally anticipates that its timing of recognition of revenue will be substantially unchanged under the amended guidance. 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 as of 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. The Company has made progress on its evaluation of the amended guidance, including identification of the population of leases affected, determining the information required to calculate the lease liability and right-of-use asset and evaluating models to assist in future reporting. 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 |
Mar. 31, 2018 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Schedule of Supplemental Cash Flow Information | Supplemental cash flow information was as follows: SIX MONTHS ENDED MARCH 31, APRIL 1, (In millions) Interest paid $ (35.7 ) $ (26.5 ) Income taxes paid (14.5 ) (3.2 ) Property and equipment acquired under capital leases — (0.6 ) |
DISCONTINUED OPERATIONS (Tables
DISCONTINUED OPERATIONS (Tables) | 6 Months Ended |
Mar. 31, 2018 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Summary of Discontinued Operations | The following table summarizes the results of the International Business and SLS Business within discontinued operations for each of the periods presented: THREE MONTHS ENDED SIX MONTHS ENDED MARCH 31, APRIL 1, MARCH 31, APRIL 1, (In millions) Net sales $ — $ 118.9 $ — $ 158.2 Operating and exit costs 1.6 99.8 1.6 146.7 Impairment, restructuring and other 0.2 2.4 1.6 4.6 Other expense, net — 0.2 — 0.1 Loss on sale / contribution of business 3.7 — 3.5 0.3 Interest expense — — — 0.4 Income (loss) from discontinued operations before income taxes (5.5 ) 16.5 (6.7 ) 6.1 Income tax expense (benefit) from discontinued operations (1.8 ) 5.4 (1.8 ) 1.8 Income (loss) from discontinued operations, net of tax $ (3.7 ) $ 11.1 $ (4.9 ) $ 4.3 The following table summarizes the major classes of assets and liabilities held for sale: APRIL 1, (In millions) Cash and cash equivalents $ 18.9 Accounts receivable, net 143.0 Inventories 62.0 Prepaid and other current assets 8.4 Property, plant and equipment, net 23.8 Goodwill and intangible assets, net 60.2 Other assets 15.2 Assets held for sale $ 331.5 Accounts payable $ 51.8 Other current liabilities 71.9 Long-term debt 12.2 Other liabilities 18.8 Liabilities held for sale $ 154.7 |
INVESTMENT IN UNCONSOLIDATED 29
INVESTMENT IN UNCONSOLIDATED AFFILIATES (Tables) | 6 Months Ended |
Mar. 31, 2018 | |
Equity Method Investments and Joint Ventures [Abstract] | |
Summary of Joint Venture Financial Information | The following table presents summarized financial information of the Company’s unconsolidated affiliates: THREE MONTHS ENDED SIX MONTHS ENDED MARCH 31, APRIL 1, MARCH 31, APRIL 1, (In millions) Revenue $ 175.7 $ 154.7 $ 447.9 $ 406.8 Gross margin 8.4 9.7 84.4 70.8 Selling and administrative expenses 52.4 51.5 116.4 92.9 Amortization expense 10.3 21.7 22.4 41.9 Interest expense 18.0 16.6 35.5 33.5 Restructuring and other charges 8.3 — 11.9 26.6 Net income (loss) $ (80.6 ) $ (80.1 ) $ (101.8 ) $ (124.1 ) |
IMPAIRMENT, RESTRUCTURING AND30
IMPAIRMENT, RESTRUCTURING AND OTHER (Tables) | 6 Months Ended |
Mar. 31, 2018 | |
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 for each of the periods presented: THREE MONTHS ENDED SIX MONTHS ENDED MARCH 31, APRIL 1, MARCH 31, APRIL 1, (In millions) Operating expenses: Restructuring and other charges $ 10.2 $ 1.0 $ 10.0 $ 0.8 Impairment, restructuring and other charges from continuing operations $ 10.2 $ 1.0 $ 10.0 $ 0.8 Restructuring and other charges from discontinued operations 0.2 2.4 1.6 4.6 Total impairment, restructuring and other charges $ 10.4 $ 3.4 $ 11.6 $ 5.4 The following table summarizes the activity related to liabilities associated with restructuring and other, excluding insurance reimbursement recoveries, during the six months ended March 31, 2018 (in millions): Amounts accrued for restructuring and other at September 30, 2017 $ 12.1 Restructuring and other charges from continuing operations 10.0 Restructuring and other charges from discontinued operations 1.6 Payments and other (6.4 ) Amounts accrued for restructuring and other at March 31, 2018 $ 17.3 |
INVENTORIES (Tables)
INVENTORIES (Tables) | 6 Months Ended |
Mar. 31, 2018 | |
Inventory Disclosure [Abstract] | |
Summary of Inventories | Inventories consisted of the following for each of the periods presented: MARCH 31, APRIL 1, SEPTEMBER 30, (In millions) Finished goods $ 395.8 $ 403.8 $ 210.6 Work-in-process 61.2 51.5 57.6 Raw materials 139.9 141.2 139.3 Total inventories $ 596.9 $ 596.5 $ 407.5 |
MARKETING AGREEMENT (Tables)
MARKETING AGREEMENT (Tables) | 6 Months Ended |
Mar. 31, 2018 | |
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 MARCH 31, APRIL 1, MARCH 31, APRIL 1, (In millions) Gross commission $ 34.5 $ 41.1 $ 34.6 $ 42.3 Contribution expenses (4.5 ) (4.5 ) (9.0 ) (9.0 ) Amortization of marketing fee (0.2 ) (0.2 ) (0.4 ) (0.4 ) Net commission 29.8 36.4 25.2 32.9 Reimbursements associated with Marketing Agreement 19.7 19.4 32.5 33.6 Total net sales associated with Marketing Agreement $ 49.5 $ 55.8 $ 57.7 $ 66.5 |
DEBT (Tables)
DEBT (Tables) | 6 Months Ended |
Mar. 31, 2018 | |
Debt Disclosure [Abstract] | |
Components of Long-Term Debt | The components of debt are as follows: MARCH 31, APRIL 1, SEPTEMBER 30, (In millions) Credit Facilities: Revolving loans $ 1,043.2 $ 1,096.8 $ 300.5 Term loans 266.3 281.3 273.8 Senior Notes – 5.250% 250.0 250.0 250.0 Senior Notes – 6.000% 400.0 400.0 400.0 Receivables facility 300.0 — 80.0 Other 22.0 56.1 105.4 Total debt 2,281.5 2,084.2 1,409.7 Less current portions 335.8 32.1 143.1 Less unamortized debt issuance costs 8.0 9.2 8.6 Long-term debt $ 1,937.7 $ 2,042.9 $ 1,258.0 |
Schedule of Interest Rate Swap Agreements | The notional amount, effective date, expiration date and rate of each of these swap agreements outstanding at March 31, 2018 are shown in the table below: Notional Amount Effective Expiration Fixed $ 300 (b) 11/21/2016 6/20/2018 0.83 % 200 (b) 11/7/2016 8/7/2018 0.84 % 150 (c) 2/7/2017 5/7/2019 2.12 % 50 (c) 2/7/2017 5/7/2019 2.25 % 50 2/28/2018 5/28/2019 2.01 % 200 (d) 12/20/2016 6/20/2019 2.12 % 250 (b) 1/8/2018 6/8/2020 2.09 % 100 6/20/2018 10/20/2020 2.15 % (a) The effective date refers to the date on which interest payments were first hedged by the applicable swap agreement. (b) Notional amount adjusts in accordance with a specified seasonal schedule. This represents the maximum notional amount at any point in time. (c) 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. (d) 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. |
RETIREMENT AND RETIREE MEDICA34
RETIREMENT AND RETIREE MEDICAL PLANS (Tables) | 6 Months Ended |
Mar. 31, 2018 | |
Defined Benefit Plan [Abstract] | |
Summary of the Components of Net Periodic Benefit (Income) 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 MARCH 31, 2018 APRIL 1, 2017 U.S. Pension International Pension U.S. Medical U.S. Pension International Pension U.S. Medical (In millions) Service cost $ — $ 0.3 $ 0.1 $ — $ 0.2 $ 0.1 Interest cost 0.7 1.1 0.2 0.7 1.0 0.1 Expected return on plan assets (1.1 ) (2.1 ) — (1.2 ) (2.0 ) — Net amortization 0.4 0.3 (0.3 ) 0.4 0.4 (0.2 ) Net periodic benefit (income) cost $ — $ (0.4 ) $ — $ (0.1 ) $ (0.4 ) $ — SIX MONTHS ENDED MARCH 31, 2018 APRIL 1, 2017 U.S. Pension International Pension U.S. Medical U.S. Pension International Pension U.S. Medical (In millions) Service cost $ — $ 0.5 $ 0.2 $ — $ 0.4 $ 0.2 Interest cost 1.5 2.1 0.3 1.4 1.9 0.3 Expected return on plan assets (2.3 ) (4.1 ) — (2.4 ) (3.9 ) — Net amortization 0.8 0.6 (0.5 ) 0.8 0.9 (0.4 ) Net periodic benefit (income) cost $ — $ (0.9 ) $ — $ (0.2 ) $ (0.7 ) $ 0.1 |
EQUITY (Tables)
EQUITY (Tables) | 6 Months Ended |
Mar. 31, 2018 | |
Equity [Abstract] | |
Summary of Changes in Equity | The following table provides a summary of the changes in total equity, equity attributable to controlling interest, and equity attributable to noncontrolling interests for the six months ended March 31, 2018 and April 1, 2017 (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, 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 (loss) — — — 3.2 3.2 — 3.2 Share-based compensation 19.1 — — — 19.1 — 19.1 Dividends declared ($1.00 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 Balance at September 30, 2017 $ 407.6 $ 978.2 $ (667.8 ) $ (69.2 ) $ 648.8 $ 12.9 $ 661.7 Net income (loss) — 127.7 — — 127.7 0.1 127.8 Other comprehensive income (loss) — — — 17.9 17.9 — 17.9 Share-based compensation 15.7 — — — 15.7 — 15.7 Dividends declared ($1.06 per share) — (61.4 ) — — (61.4 ) — (61.4 ) Treasury share purchases — — (256.8 ) — (256.8 ) — (256.8 ) Treasury share issuances (8.6 ) — 13.2 — 4.6 — 4.6 Acquisition of remaining noncontrolling interest in Gavita (5.7 ) — — — (5.7 ) (7.9 ) (13.6 ) Balance at March 31, 2018 $ 409.0 $ 1,044.5 $ (911.4 ) $ (51.3 ) $ 490.8 $ 5.1 $ 495.9 |
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 MARCH 31, APRIL 1, Employees Restricted stock units 109,563 102,143 Performance units 235,503 487,674 Board of Directors Deferred stock units 20,799 22,902 Total share-based awards 365,865 612,719 Aggregate fair value at grant dates (in millions) $ 34.9 $ 56.9 |
Schedule of Share-Based Compensation | Total share-based compensation was as follows for each of the periods indicated: THREE MONTHS ENDED SIX MONTHS ENDED MARCH 31, APRIL 1, MARCH 31, APRIL 1, (In millions) Share-based compensation $ 9.7 $ 12.8 $ 15.7 $ 15.1 Tax benefit recognized 1.8 4.9 4.1 5.8 |
Schedule of Stock Option Activity | Stock Options Aggregate stock option activity was as follows: No. of Options Wtd. Avg. Exercise Price Awards outstanding at September 30, 2017 1,517,310 $ 53.05 Granted — — Exercised (72,027 ) 50.38 Forfeited (1,367 ) 36.86 Awards outstanding at March 31, 2018 1,443,916 53.20 Exercisable 1,017,603 $ 46.72 |
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 March 31, 2018 (options in millions): Awards Outstanding Awards Exercisable Range of Exercise Price 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 0.2 0.51 $ 20.59 0.2 0.51 $ 20.59 $38.81 – $49.19 0.4 2.93 45.22 0.4 2.93 45.22 $63.43 – $68.68 0.8 7.36 66.26 0.4 6.84 63.49 1.4 5.02 $ 53.20 1.0 3.84 $ 46.72 |
Schedule of Intrinsic Values of Stock Option Awards | The intrinsic values of the stock option awards outstanding and exercisable at March 31, 2018 were as follows (in millions): Outstanding $ 47.0 Exercisable 39.7 |
Schedule of Restricted Share-based Award Activity | 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, 2017 291,519 $ 81.15 Granted 130,362 90.86 Vested (86,601 ) 67.70 Forfeited — — Awards outstanding at March 31, 2018 335,280 $ 88.39 |
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, 2017 596,933 $ 88.01 Granted 235,503 97.72 Vested (53,644 ) 63.43 Forfeited (3,037 ) 98.81 Awards outstanding at March 31, 2018 775,755 $ 92.61 |
DERIVATIVE INSTRUMENTS AND HE36
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES (Tables) | 6 Months Ended |
Mar. 31, 2018 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Summary of Outstanding Derivative Contracts | The Company had the following outstanding commodity contracts that were entered into to hedge forecasted purchases: COMMODITY MARCH 31, APRIL 1, SEPTEMBER 30, Urea 42,000 tons 28,500 tons 76,500 tons Diesel 3,360,000 gallons 5,544,000 gallons 5,586,000 gallons Heating Oil 1,092,000 gallons 1,680,000 gallons 1,386,000 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 MARCH 31, APRIL 1, SEPTEMBER 30, BALANCE SHEET LOCATION FAIR VALUE (In millions) Interest rate swap agreements Prepaid and other current assets $ 1.5 $ 0.7 $ 1.3 Other assets 1.9 0.8 — Other current liabilities — (1.9 ) (0.8 ) Other liabilities — (0.7 ) (0.4 ) Commodity hedging instruments Prepaid and other current assets — — 3.2 Other current liabilities (0.5 ) (0.2 ) — Total derivatives designated as hedging instruments $ 2.9 $ (1.3 ) $ 3.3 DERIVATIVES NOT DESIGNATED AS HEDGING INSTRUMENTS BALANCE SHEET LOCATION Currency forward contracts Prepaid and other current assets $ 0.3 $ 0.5 $ 2.0 Other current liabilities (1.0 ) (4.0 ) (0.2 ) Commodity hedging instruments Prepaid and other current assets 1.1 — 0.6 Other current liabilities — (0.1 ) — Total derivatives not designated as hedging instruments 0.4 (3.6 ) 2.4 Total derivatives $ 3.3 $ (4.9 ) $ 5.7 |
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 MARCH 31, APRIL 1, MARCH 31, APRIL 1, (In millions) Interest rate swap agreements $ 2.1 $ 0.4 $ 2.5 $ 2.5 Commodity hedging instruments (0.1 ) (0.4 ) 0.3 0.5 Total $ 2.0 $ — $ 2.8 $ 3.0 DERIVATIVES IN CASH FLOW HEDGING RELATIONSHIPS RECLASSIFIED FROM AOCI INTO STATEMENT OF OPERATIONS AMOUNT OF GAIN / (LOSS) THREE MONTHS ENDED SIX MONTHS ENDED MARCH 31, APRIL 1, MARCH 31, APRIL 1, (In millions) Interest rate swap agreements Interest expense $ 0.1 $ (0.9 ) $ 0.2 $ (1.2 ) Commodity hedging instruments Cost of sales 1.0 (0.2 ) 1.0 (0.3 ) Total $ 1.1 $ (1.1 ) $ 1.2 $ (1.5 ) DERIVATIVES NOT DESIGNATED AS HEDGING INSTRUMENTS RECOGNIZED IN STATEMENT OF OPERATIONS AMOUNT OF GAIN / (LOSS) THREE MONTHS ENDED SIX MONTHS ENDED MARCH 31, APRIL 1, MARCH 31, APRIL 1, (In millions) Currency forward contracts Other income / expense, net $ (2.6 ) $ (2.2 ) $ (5.2 ) $ 7.0 Commodity hedging instruments Cost of sales 0.2 (0.9 ) 1.5 — Total $ (2.4 ) $ (3.1 ) $ (3.7 ) $ 7.0 |
FAIR VALUE MEASUREMENTS (Tables
FAIR VALUE MEASUREMENTS (Tables) | 6 Months Ended |
Mar. 31, 2018 | |
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 March 31, 2018 : 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 $ 0.9 $ — $ — $ 0.9 Derivatives Interest rate swap agreements — 3.4 — 3.4 Currency forward contracts — 0.3 — 0.3 Commodity hedging instruments — 1.1 — 1.1 Other 18.0 — 11.8 29.8 Total $ 18.9 $ 4.8 $ 11.8 $ 35.5 Liabilities Derivatives Currency forward contracts $ — $ (1.0 ) $ — $ (1.0 ) Commodity hedging instruments — (0.5 ) — (0.5 ) Total $ — $ (1.5 ) $ — $ (1.5 ) 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 September 30, 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 $ 26.2 $ — $ — $ 26.2 Derivatives Interest rate swap agreements — 1.3 — 1.3 Currency forward contracts — 2.0 — 2.0 Commodity hedging instruments — 3.8 — 3.8 Other 15.7 — 11.8 27.5 Total $ 41.9 $ 7.1 $ 11.8 $ 60.8 Liabilities Derivatives Interest rate swap agreements $ — $ (1.2 ) $ — $ (1.2 ) Currency forward contracts — (0.2 ) — (0.2 ) Long-term debt — — (55.6 ) (55.6 ) Total $ — $ (1.4 ) $ (55.6 ) $ (57.0 ) |
SEGMENT INFORMATION (Tables)
SEGMENT INFORMATION (Tables) | 6 Months Ended |
Mar. 31, 2018 | |
Segment Reporting [Abstract] | |
Summary of Segment Financial Information | The following tables present financial information for the Company’s reportable segments for the periods indicated: THREE MONTHS ENDED SIX MONTHS ENDED MARCH 31, APRIL 1, MARCH 31, APRIL 1, (In millions) Net sales: U.S. Consumer $ 920.2 $ 974.8 $ 1,046.1 $ 1,101.0 Hawthorne 41.8 59.1 118.5 122.8 Other 51.3 50.7 70.3 68.2 Consolidated $ 1,013.3 $ 1,084.6 $ 1,234.9 $ 1,292.0 Segment Profit (Loss): U.S. Consumer $ 286.2 $ 313.9 $ 248.3 $ 275.4 Hawthorne (4.8 ) 9.6 (3.0 ) 16.3 Other 1.6 3.8 (2.5 ) 1.5 Total Segment Profit (Loss) 283.0 327.3 242.8 293.2 Corporate (33.6 ) (35.4 ) (58.7 ) (57.8 ) Intangible asset amortization (6.9 ) (5.6 ) (13.7 ) (11.1 ) Impairment, restructuring and other (10.2 ) (1.0 ) (10.0 ) (0.8 ) Equity in income (loss) of unconsolidated affiliates 1.5 (24.1 ) 2.1 (37.3 ) Interest expense (22.6 ) (21.5 ) (40.4 ) (36.8 ) Other non-operating expense, net (9.2 ) — (6.7 ) — Income from continuing operations before income taxes $ 202.0 $ 239.7 $ 115.4 $ 149.4 MARCH 31, APRIL 1, SEPTEMBER 30, (In millions) Total assets: U.S. Consumer $ 2,487.6 $ 2,569.4 $ 1,650.3 Hawthorne 664.4 502.3 648.0 Other 213.7 209.9 150.7 Corporate 209.8 178.9 298.0 Assets held for sale — 331.5 — Consolidated $ 3,575.5 $ 3,792.0 $ 2,747.0 |
FINANCIAL INFORMATION FOR SUB39
FINANCIAL INFORMATION FOR SUBSIDIARY GUARANTORS AND NON-GUARANTORS (Tables) | 6 Months Ended |
Mar. 31, 2018 | |
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 March 31, 2018 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated Net sales $ — $ 951.9 $ 61.4 $ — $ 1,013.3 Cost of sales — 555.6 48.5 — 604.1 Gross profit — 396.3 12.9 — 409.2 Operating expenses: Selling, general and administrative — 150.1 15.6 0.3 166.0 Impairment, restructuring and other — 10.2 — — 10.2 Other (income) expense, net (0.2 ) 0.9 — — 0.7 Income (loss) from operations 0.2 235.1 (2.7 ) (0.3 ) 232.3 Equity (income) loss in subsidiaries (158.9 ) 3.8 — 155.1 — Equity in (income) loss of unconsolidated affiliates — — (1.5 ) — (1.5 ) Interest expense 20.9 13.1 1.3 (12.7 ) 22.6 Other non-operating (income) expense, net (7.9 ) (2.5 ) 6.9 12.7 9.2 Income (loss) from continuing operations before income taxes 146.1 220.7 (9.4 ) (155.4 ) 202.0 Income tax expense (benefit) from continuing operations (3.1 ) 54.7 (2.3 ) — 49.3 Income (loss) from continuing operations 149.2 166.0 (7.1 ) (155.4 ) 152.7 Income (loss) from discontinued operations, net of tax — (3.7 ) — — (3.7 ) Net income (loss) $ 149.2 $ 162.3 $ (7.1 ) $ (155.4 ) $ 149.0 Net (income) loss attributable to noncontrolling interest — — — (0.1 ) (0.1 ) Net income (loss) attributable to controlling interest $ 149.2 $ 162.3 $ (7.1 ) $ (155.5 ) $ 148.9 Condensed Consolidating Statement of Operations for the six months ended March 31, 2018 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated Net sales $ — $ 1,099.5 $ 135.4 $ — $ 1,234.9 Cost of sales — 682.6 109.1 — 791.7 Gross profit — 416.9 26.3 — 443.2 Operating expenses: Selling, general and administrative — 240.5 33.0 0.7 274.2 Impairment, restructuring and other — 10.0 — — 10.0 Other (income) expense, net (0.4 ) (0.2 ) (0.8 ) — (1.4 ) Income (loss) from operations 0.4 166.6 (5.9 ) (0.7 ) 160.4 Equity (income) loss in subsidiaries (157.8 ) 5.5 — 152.3 — Equity in (income) loss of unconsolidated affiliates — — (2.1 ) — (2.1 ) Interest expense 37.8 21.8 2.2 (21.4 ) 40.4 Other non-operating (income) expense, net (11.8 ) (5.0 ) 2.1 21.4 6.7 Income (loss) from continuing operations before income taxes 132.2 144.3 (8.1 ) (153.0 ) 115.4 Income tax expense (benefit) from continuing operations 3.8 (22.4 ) 1.3 — (17.3 ) Income (loss) from continuing operations 128.4 166.7 (9.4 ) (153.0 ) 132.7 Income (loss) from discontinued operations, net of tax — (3.9 ) (1.0 ) — (4.9 ) Net income (loss) $ 128.4 $ 162.8 $ (10.4 ) $ (153.0 ) $ 127.8 Net (income) loss attributable to noncontrolling interest — — — (0.1 ) (0.1 ) Net income (loss) attributable to controlling interest $ 128.4 $ 162.8 $ (10.4 ) $ (153.1 ) $ 127.7 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 $ 85.8 $ — $ 1,084.6 Cost of sales — 558.5 61.8 — 620.3 Gross profit — 440.3 24.0 — 464.3 Operating expenses: Selling, general and administrative — 160.3 18.1 0.4 178.8 Impairment, restructuring and other — 1.0 — — 1.0 Other (income) expense, net (0.2 ) (1.1 ) 0.5 — (0.8 ) Income (loss) from operations 0.2 280.1 5.4 (0.4 ) 285.3 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 161.0 253.0 8.2 (182.5 ) 239.7 Income tax expense (benefit) from continuing operations (4.6 ) 86.9 3.3 — 85.6 Income (loss) from continuing operations 165.6 166.1 4.9 (182.5 ) 154.1 Income (loss) from discontinued operations, net of tax — 1.1 10.0 — 11.1 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 $ 147.7 $ — $ 1,292.0 Cost of sales — 685.0 105.9 — 790.9 Gross profit — 459.3 41.8 — 501.1 Operating expenses: Selling, general and administrative — 247.1 35.1 0.7 282.9 Impairment, restructuring and other — 0.8 — — 0.8 Other (income) expense, net (0.4 ) (6.4 ) 0.7 — (6.1 ) Income (loss) from operations 0.4 217.8 6.0 (0.7 ) 223.5 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 1.9 (21.7 ) 36.8 Income (loss) from continuing operations before income taxes 92.3 166.3 13.9 (123.1 ) 149.4 Income tax expense (benefit) from continuing operations (8.2 ) 56.4 5.2 — 53.4 Income (loss) from continuing operations 100.5 109.9 8.7 (123.1 ) 96.0 Income (loss) from discontinued operations, net of tax — 0.1 4.2 — 4.3 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 Comprehensive Income (Loss) | Condensed Consolidating Statement of Comprehensive Income (Loss) for the three months ended March 31, 2018 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated Net income (loss) $ 149.2 $ 162.3 $ (7.1 ) $ (155.4 ) $ 149.0 Other comprehensive income (loss), net of tax: Net foreign currency translation adjustment 15.8 — 15.8 (15.8 ) 15.8 Net change in derivatives 0.9 (1.1 ) — 1.1 0.9 Net change in pension and other post-retirement benefits 0.3 0.1 0.2 (0.3 ) 0.3 Total other comprehensive income (loss) 17.0 (1.0 ) 16.0 (15.0 ) 17.0 Comprehensive income (loss) $ 166.2 $ 161.3 $ 8.9 $ (170.4 ) $ 166.0 Condensed Consolidating Statement of Comprehensive Income (Loss) for the six months ended March 31, 2018 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated Net income (loss) $ 128.4 $ 162.8 $ (10.4 ) $ (153.0 ) $ 127.8 Other comprehensive income (loss), net of tax: Net foreign currency translation adjustment 15.7 — 15.7 (15.7 ) 15.7 Net change in derivatives 1.6 (0.7 ) — 0.7 1.6 Net change in pension and other post-retirement benefits 0.6 0.2 0.4 (0.6 ) 0.6 Total other comprehensive income (loss) 17.9 (0.5 ) 16.1 (15.6 ) 17.9 Comprehensive income (loss) $ 146.3 $ 162.3 $ 5.7 $ (168.6 ) $ 145.7 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 Cash Flows | Condensed Consolidating Statement of Cash Flows for the six months ended March 31, 2018 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES (a) $ 9.5 $ (503.5 ) $ 25.2 $ (14.0 ) $ (482.8 ) INVESTING ACTIVITIES (a) Proceeds from sale of long-lived assets — 0.2 — — 0.2 Post-closing working capital payment related to sale of International Business — (35.3 ) — — (35.3 ) Investments in property, plant and equipment — (29.8 ) (3.3 ) — (33.1 ) Investments in loans receivable — (7.4 ) (0.3 ) — (7.7 ) Investments in acquired businesses, net of cash acquired — (40.5 ) (103.7 ) — (144.2 ) Return of investments from affiliates 554.0 — — (554.0 ) — Investing cash flows from (to) affiliates (250.2 ) (70.2 ) (80.0 ) 400.4 — Net cash provided by (used in) investing activities 303.8 (183.0 ) (187.3 ) (153.6 ) (220.1 ) FINANCING ACTIVITIES Borrowings under revolving and bank lines of credit and term loans — 1,032.9 139.7 — 1,172.6 Repayments under revolving and bank lines of credit and term loans — (154.8 ) (88.6 ) — (243.4 ) Dividends paid (60.3 ) (554.0 ) (14.0 ) 568.0 (60.3 ) Purchase of Common Shares (256.8 ) — — — (256.8 ) Payments on seller notes — — (3.0 ) — (3.0 ) Cash received from the exercise of stock options 3.8 — — — 3.8 Financing cash flows from (to) affiliates — 330.2 70.2 (400.4 ) — Net cash provided by (used in) financing activities (313.3 ) 654.3 104.3 167.6 612.9 Effect of exchange rate changes on cash — — 2.5 — 2.5 Net increase (decrease) in cash and cash equivalents — (32.2 ) (55.3 ) — (87.5 ) Cash and cash equivalents at beginning of period — 39.8 80.7 — 120.5 Cash and cash equivalents at end of period $ — $ 7.6 $ 25.4 $ — $ 33.0 (a) Cash received by the Parent from the Guarantors and Non-Guarantors in the form of dividends in the amount of $554.0 million represent return of investments and are included in cash flows from investing activities. Cash received by the Parent from the Guarantors and Non-Guarantors in the form of dividends in the amount of $12.2 million represent return on investments and are included in cash flows from operating activities. Cash received by the Guarantors from the Non-Guarantors in the form of dividends in the amount of $1.8 million represent return on investments and are included in cash flows from operating activities. 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 $ (8.2 ) $ (386.6 ) $ (94.2 ) $ — $ (489.0 ) 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 ) Net (investments in) distributions from 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 to noncontrolling interest — — (40.5 ) 32.4 (8.1 ) Purchase of Common Shares (99.2 ) — — — (99.2 ) 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 92.8 658.4 198.9 (329.1 ) 621.0 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 excluding cash classified within assets held for sale — 2.7 25.9 — 28.6 Cash and cash equivalents at beginning of period classified within assets held for sale — — 21.5 — 21.5 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 Balance Sheet | Condensed Consolidating Balance Sheet As of March 31, 2018 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated ASSETS Current assets: Cash and cash equivalents $ — $ 7.6 $ 25.4 $ — $ 33.0 Accounts receivable, net — 533.0 65.0 — 598.0 Accounts receivable pledged — 333.3 — — 333.3 Inventories — 495.5 101.4 — 596.9 Prepaid and other current assets 1.7 55.0 21.4 — 78.1 Total current assets 1.7 1,424.4 213.2 — 1,639.3 Investment in unconsolidated affiliates — — 33.2 — 33.2 Property, plant and equipment, net — 399.8 63.8 — 463.6 Goodwill — 323.0 132.2 11.6 466.8 Intangible assets, net — 633.9 135.6 8.1 777.6 Other assets 8.7 171.1 15.2 — 195.0 Equity investment in subsidiaries 1,287.1 — — (1,287.1 ) — Intercompany assets 1,163.1 304.0 — (1,467.1 ) — Total assets $ 2,460.6 $ 3,256.2 $ 593.2 $ (2,734.5 ) $ 3,575.5 LIABILITIES AND EQUITY Current liabilities: Current portion of debt $ 15.0 $ 317.7 $ 18.1 $ (15.0 ) $ 335.8 Accounts payable — 222.6 30.9 — 253.5 Other current liabilities 17.2 265.5 34.1 — 316.8 Total current liabilities 32.2 805.8 83.1 (15.0 ) 906.1 Long-term debt 1,936.6 1,166.8 128.8 (1,294.5 ) 1,937.7 Distributions in excess of investment in unconsolidated affiliate — 21.9 — — 21.9 Other liabilities 1.0 148.1 59.8 5.0 213.9 Equity investment in subsidiaries — 69.3 — (69.3 ) — Intercompany liabilities — — 134.9 (134.9 ) — Total liabilities 1,969.8 2,211.9 406.6 (1,508.7 ) 3,079.6 Total equity—controlling interest 490.8 1,044.3 186.6 (1,230.9 ) 490.8 Noncontrolling interest — — — 5.1 5.1 Total equity 490.8 1,044.3 186.6 (1,225.8 ) 495.9 Total liabilities and equity $ 2,460.6 $ 3,256.2 $ 593.2 $ (2,734.5 ) $ 3,575.5 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 $ 49.9 $ — $ 55.4 Accounts receivable, net — 900.8 77.5 — 978.3 Inventories — 500.7 95.8 — 596.5 Assets held for sale — — 331.5 — 331.5 Prepaid and other current assets 0.7 47.4 37.6 — 85.7 Total current assets 0.7 1,454.4 592.3 — 2,047.4 Investment in unconsolidated affiliates — 59.1 0.8 — 59.9 Property, plant and equipment, net — 385.8 51.3 — 437.1 Goodwill — 262.9 126.1 11.6 400.6 Intangible assets, net — 554.2 163.1 9.5 726.8 Other assets 10.7 107.8 2.1 (0.4 ) 120.2 Equity investment in subsidiaries 938.7 — — (938.7 ) — Intercompany assets 1,778.4 — — (1,778.4 ) — Total assets $ 2,728.5 $ 2,824.2 $ 935.7 $ (2,696.4 ) $ 3,792.0 LIABILITIES AND EQUITY Current liabilities: Current portion of debt $ 15.0 $ 15.8 $ 16.3 $ (15.0 ) $ 32.1 Accounts payable — 240.6 30.2 — 270.8 Liabilities held for sale — — 154.7 — 154.7 Other current liabilities 17.8 260.7 39.6 — 318.1 Total current liabilities 32.8 517.1 240.8 (15.0 ) 775.7 Long-term debt 2,016.1 1,288.2 114.0 (1,375.4 ) 2,042.9 Other liabilities 0.7 224.7 51.9 4.7 282.0 Equity investment in subsidiaries — 31.5 — (31.5 ) — Intercompany liabilities — 45.3 326.1 (371.4 ) — Total liabilities 2,049.6 2,106.8 732.8 (1,788.6 ) 3,100.6 Total equity—controlling interest 678.9 717.4 202.9 (920.3 ) 678.9 Noncontrolling interest — — — 12.5 12.5 Total equity 678.9 717.4 202.9 (907.8 ) 691.4 Total liabilities and equity $ 2,728.5 $ 2,824.2 $ 935.7 $ (2,696.4 ) $ 3,792.0 Condensed Consolidating Balance Sheet As of September 30, 2017 (In millions) (Unaudited) Parent Subsidiary Guarantors Non- Guarantors Eliminations/ Consolidations Consolidated ASSETS Current assets: Cash and cash equivalents $ — $ 39.8 $ 80.7 $ — $ 120.5 Accounts receivable, net — 137.6 60.1 — 197.7 Accounts receivable pledged — 88.9 — — 88.9 Inventories — 314.0 93.5 — 407.5 Prepaid and other current assets 1.3 43.4 22.4 — 67.1 Total current assets 1.3 623.7 256.7 — 881.7 Investment in unconsolidated affiliates — — 31.1 — 31.1 Property, plant and equipment, net — 406.4 61.3 — 467.7 Goodwill — 320.7 109.3 11.6 441.6 Intangible assets, net — 606.3 133.8 8.8 748.9 Other assets 8.1 158.3 9.6 — 176.0 Equity investment in subsidiaries 1,112.8 — — (1,112.8 ) — Intercompany assets 759.7 — — (759.7 ) — Total assets $ 1,881.9 $ 2,115.4 $ 601.8 $ (1,852.1 ) $ 2,747.0 LIABILITIES AND EQUITY Current liabilities: Current portion of debt $ 15.0 $ 97.8 $ 45.3 $ (15.0 ) $ 143.1 Accounts payable — 124.9 28.2 — 153.1 Other current liabilities 17.1 191.5 39.7 — 248.3 Total current liabilities 32.1 414.2 113.2 (15.0 ) 544.5 Long-term debt 1,200.7 508.6 108.0 (559.3 ) 1,258.0 Distributions in excess of investment in unconsolidated affiliate — 21.9 — — 21.9 Other liabilities 0.3 197.4 58.2 5.0 260.9 Equity investment in subsidiaries — 82.6 — (82.6 ) — Intercompany liabilities — 17.1 152.7 (169.8 ) — Total liabilities 1,233.1 1,241.8 432.1 (821.7 ) 2,085.3 Total equity—controlling interest 648.8 873.6 169.7 (1,043.3 ) 648.8 Noncontrolling interest — — — 12.9 12.9 Total equity 648.8 873.6 169.7 (1,030.4 ) 661.7 Total liabilities and equity $ 1,881.9 $ 2,115.4 $ 601.8 $ (1,852.1 ) $ 2,747.0 |
SUMMARY OF SIGNIFICANT ACCOUN40
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Additional Information (Details) - USD ($) $ in Millions | Oct. 02, 2017 | Mar. 31, 2018 | Apr. 01, 2017 | Mar. 31, 2018 | Apr. 01, 2017 |
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Percentage of annual net sales | 75.00% | 75.00% | |||
Interest income on loans receivable | $ 2.5 | $ 2.1 | $ 5 | $ 4.8 | |
Capital expenditure unpaid liabilities incurred | 3.3 | 2.3 | |||
Recognition of excess tax benefits | $ 1.5 | 1.9 | |||
Excess tax benefits from share-based payment arrangements | 3.2 | 0 | 4 | ||
Payments classified as cash flows related to tax guidance | 2.9 | 8.8 | |||
Accounting Standards Update 2015-07 | Other liabilities | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Deferred tax assets | $ 43.1 | 43.1 | |||
Gavita Holdings B.V. | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Contingent consideration paid | $ 3 | $ 3 | |||
Fafard & Brothers Ltd. | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Contingent consideration paid | 6.7 | ||||
Growing Media Acquisition, Canada [Member] | |||||
New Accounting Pronouncements or Change in Accounting Principle [Line Items] | |||||
Contingent consideration paid | $ 6.5 |
SUMMARY OF SIGNIFICANT ACCOUN41
SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - Supplemental Cash Flow Information (Details) - USD ($) $ in Millions | 6 Months Ended | |
Mar. 31, 2018 | Apr. 01, 2017 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Interest paid | $ (35.7) | $ (26.5) |
Income taxes paid | (14.5) | (3.2) |
Property and equipment acquired under capital leases | $ 0 | $ (0.6) |
DISCONTINUED OPERATIONS - Addit
DISCONTINUED OPERATIONS - Additional Information (Details) - USD ($) $ in Millions | Aug. 31, 2017 | Mar. 31, 2018 | Apr. 01, 2017 | Mar. 31, 2018 | Apr. 01, 2017 | Sep. 30, 2017 | Apr. 13, 2016 |
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Cash used in operating activities | $ 0 | $ (65.9) | |||||
Cash used in investing activities | (35.3) | (3.1) | |||||
International Business | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Cash proceeds at closing | $ 150.6 | ||||||
Seller financing provided in form of a loan | $ 29.7 | ||||||
Term of financing | 7 years | ||||||
Financing interest rate | 5.00% | ||||||
Annual interest rate increase | 2.50% | ||||||
Contingent consideration maximum payout | $ 23.8 | ||||||
Fair value of contingent consideration | 18.2 | ||||||
Other current liabilities related to working capital adjustments | $ 27.8 | ||||||
Pre-tax gain on sale | 32.7 | ||||||
Provision for income taxes on sale | 12 | ||||||
Write-off of accumulated foreign currency translation adjustments | $ 18.5 | ||||||
Adjustment to gain on contribution of SLS Business | $ 3.7 | ||||||
Fair value of license agreement | $ 14.1 | ||||||
Divestiture transaction related costs | $ 0.2 | $ 2.3 | $ 1.6 | 3.9 | |||
Scotts Lawnservice | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Adjustment to gain on contribution of SLS Business | 0.3 | ||||||
Divestiture transaction related costs | $ 0.1 | $ 0.7 | |||||
TruGreen Joint Venture | Scotts Lawnservice | |||||||
Income Statement, Balance Sheet and Additional Disclosures by Disposal Groups, Including Discontinued Operations [Line Items] | |||||||
Equity ownership percentage | 30.00% | 30.00% | 30.00% |
DISCONTINUED OPERATIONS - Summa
DISCONTINUED OPERATIONS - Summary of Income from Discontinued Operations (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2018 | Apr. 01, 2017 | Mar. 31, 2018 | Apr. 01, 2017 | |
Discontinued Operations and Disposal Groups [Abstract] | ||||
Net sales | $ 0 | $ 118.9 | $ 0 | $ 158.2 |
Operating and exit costs | 1.6 | 99.8 | 1.6 | 146.7 |
Impairment, restructuring and other | 10.2 | 1 | 10 | 0.8 |
Restructuring and other charges from discontinued operations | 0.2 | 2.4 | 1.6 | 4.6 |
Other expense, net | 0 | 0.2 | 0 | 0.1 |
Loss on sale / contribution of business | 3.7 | 0 | 3.5 | 0.3 |
Interest expense | 0 | 0 | 0 | 0.4 |
Income (loss) from discontinued operations before income taxes | (5.5) | 16.5 | (6.7) | 6.1 |
Income tax expense (benefit) from discontinued operations | (1.8) | 5.4 | (1.8) | 1.8 |
Income (loss) from discontinued operations, net of tax | $ (3.7) | $ 11.1 | $ (4.9) | $ 4.3 |
DISCONTINUED OPERATIONS - Sum44
DISCONTINUED OPERATIONS - Summary of Balance Sheet Components of Discontinued Operations (Details) - USD ($) $ in Millions | Mar. 31, 2018 | Sep. 30, 2017 | Apr. 01, 2017 | Sep. 30, 2016 |
Discontinued Operations and Disposal Groups [Abstract] | ||||
Cash and cash equivalents | $ 0 | $ 18.9 | $ 21.5 | |
Accounts receivable, net | 143 | |||
Inventories | 62 | |||
Prepaid and other current assets | 8.4 | |||
Property, plant and equipment, net | 23.8 | |||
Goodwill and intangible assets, net | 60.2 | |||
Other assets | 15.2 | |||
Assets held for sale | $ 0 | $ 0 | 331.5 | |
Accounts payable | 51.8 | |||
Other current liabilities | 71.9 | |||
Long-term debt | 12.2 | |||
Other liabilities | 18.8 | |||
Liabilities held for sale | $ 154.7 |
ACQUISITIONS AND INVESTMENTS (D
ACQUISITIONS AND INVESTMENTS (Details) - USD ($) $ in Millions | Oct. 11, 2017 | Oct. 02, 2017 | Aug. 11, 2017 | May 26, 2017 | Oct. 03, 2016 | Mar. 31, 2018 | Jul. 01, 2017 | Apr. 01, 2017 | Dec. 31, 2016 | Mar. 31, 2018 | Apr. 01, 2017 | Sep. 30, 2017 | May 26, 2016 |
ACQUISITIONS | |||||||||||||
Acquisition of remaining noncontrolling interest | $ (13.6) | ||||||||||||
Goodwill | $ 466.8 | $ 400.6 | 466.8 | $ 400.6 | $ 441.6 | ||||||||
Gavita Holdings B.V. | |||||||||||||
ACQUISITIONS | |||||||||||||
Economic interest acquired | 25.00% | 75.00% | |||||||||||
Remaining noncontrolling interest | 25.00% | ||||||||||||
Noncontrolling interest percentage owned by noncontrolling owners | 5.00% | ||||||||||||
Aggregate purchase price | $ 69.2 | ||||||||||||
Contingent consideration paid | $ 3 | 3 | |||||||||||
Fair value of debt | 55.6 | 55.6 | $ 55.6 | ||||||||||
Acquisition of remaining noncontrolling interest | (7.9) | ||||||||||||
Can-Filters Group Inc. | |||||||||||||
ACQUISITIONS | |||||||||||||
Aggregate purchase price | $ 74.1 | ||||||||||||
Cash, prepaid, and other current assets | 2.1 | ||||||||||||
Inventory and accounts receivable | 7.7 | ||||||||||||
Fixed assets acquired | 4.4 | ||||||||||||
Accounts payable and other current liabilities acquired | 0.7 | ||||||||||||
Finite-lived intangible assets acquired | 39.7 | ||||||||||||
Goodwill tax deductible amount | $ 20.9 | ||||||||||||
Finite-lived intangible asset, useful life | 25 years | ||||||||||||
Net revenue | 3.4 | 7.9 | |||||||||||
Botanicare Manufacturer And Formulator | |||||||||||||
ACQUISITIONS | |||||||||||||
Aggregate purchase price | $ 32 | ||||||||||||
Finite-lived intangible assets acquired | 5 | ||||||||||||
Goodwill tax deductible amount | 26.7 | ||||||||||||
Inventory acquired | $ 0.3 | ||||||||||||
Botanicare Manufacturer And Formulator | Minimum | |||||||||||||
ACQUISITIONS | |||||||||||||
Finite-lived intangible asset, useful life | 5 years | ||||||||||||
Botanicare Manufacturer And Formulator | Maximum | |||||||||||||
ACQUISITIONS | |||||||||||||
Finite-lived intangible asset, useful life | 10 years | ||||||||||||
Agrolux Holding B.V. | |||||||||||||
ACQUISITIONS | |||||||||||||
Aggregate purchase price | $ 21.8 | ||||||||||||
Cash, prepaid, and other current assets | 8 | ||||||||||||
Inventory and accounts receivable | 10.1 | ||||||||||||
Fixed assets acquired | 0.5 | ||||||||||||
Accounts payable and other current liabilities acquired | 8.6 | ||||||||||||
Short term debt acquired | 6.7 | ||||||||||||
Finite-lived intangible assets acquired | 16.1 | ||||||||||||
Contingent consideration for acquired business | 5.2 | ||||||||||||
Goodwill | 6.4 | ||||||||||||
Deferred tax liabilities acquired | $ 4 | ||||||||||||
Net revenue | 5.3 | 26 | |||||||||||
Agrolux Holding B.V. | Minimum | |||||||||||||
ACQUISITIONS | |||||||||||||
Finite-lived intangible asset, useful life | 10 years | ||||||||||||
Agrolux Holding B.V. | Maximum | |||||||||||||
ACQUISITIONS | |||||||||||||
Finite-lived intangible asset, useful life | 20 years | ||||||||||||
American Agritech, L.L.C. | |||||||||||||
ACQUISITIONS | |||||||||||||
Aggregate purchase price | $ 92.6 | ||||||||||||
Cash, prepaid, and other current assets | 1.2 | ||||||||||||
Inventory and accounts receivable | 8.4 | ||||||||||||
Fixed assets acquired | 1.4 | ||||||||||||
Accounts payable and other current liabilities acquired | 2.3 | ||||||||||||
Finite-lived intangible assets acquired | 53 | ||||||||||||
Goodwill tax deductible amount | 30.9 | ||||||||||||
Contingent consideration for acquired business | $ 15.5 | ||||||||||||
Net revenue | $ 8.1 | $ 11.3 | $ 15.2 | $ 21.2 | |||||||||
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 | $ 3.2 | ||||||||||||
Valuation of acquired assets, intangible assets and goodwill | $ 2.8 | ||||||||||||
Hydroponic Growth System Technology Company | |||||||||||||
ACQUISITIONS | |||||||||||||
Aggregate purchase price | $ 3.5 | ||||||||||||
Finite-lived intangible assets acquired | $ 3.2 |
INVESTMENT IN UNCONSOLIDATED 46
INVESTMENT IN UNCONSOLIDATED AFFILIATES - Additional Information (Details) - USD ($) | 3 Months Ended | 6 Months Ended | ||||
Mar. 31, 2018 | Sep. 30, 2017 | Apr. 01, 2017 | Mar. 31, 2018 | Apr. 01, 2017 | Apr. 13, 2016 | |
Schedule of Equity Method Investments [Line Items] | ||||||
Accounts receivable, net | $ 598,000,000 | $ 197,700,000 | $ 978,300,000 | $ 598,000,000 | $ 978,300,000 | |
Distributions in excess of investment in unconsolidated affiliate | 21,900,000 | 21,900,000 | 0 | 21,900,000 | 0 | |
Investments in loans receivable | (7,700,000) | 0 | ||||
Equity in (income) loss of unconsolidated affiliates | (1,500,000) | 24,100,000 | (2,100,000) | 37,300,000 | ||
TruGreen Joint Venture | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Estimated market value | $ 294,000,000 | |||||
Second lien term loan investment | $ 18,000,000 | |||||
Carrying value of second lien term loan | 18,100,000 | 18,000,000 | 18,100,000 | 18,000,000 | ||
Reimbursements | 100,000 | 14,700,000 | 600,000 | 33,700,000 | ||
Accounts receivable, net | 500,000 | 8,300,000 | 500,000 | 8,300,000 | ||
Distributions received from unconsolidated affiliates | 0 | 0 | 0 | 2,200,000 | ||
Indemnification asset | 4,200,000 | 7,400,000 | 4,200,000 | 7,400,000 | ||
Distributions in excess of investment in unconsolidated affiliate | $ 21,900,000 | $ 21,900,000 | ||||
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 | ||||
Scotts Lawnservice | TruGreen Joint Venture | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Equity ownership percentage | 30.00% | 30.00% | 30.00% | |||
U.S. Consumer | Unconsolidated Subsidiary Whose Products Support The Professional U.S. Industrial, Turf And Ornamental Market | ||||||
Schedule of Equity Method Investments [Line Items] | ||||||
Investment in unconsolidated subsidiary | $ 29,400,000 | |||||
Investment in joint venture | $ 2,100,000 | $ 7,400,000 |
INVESTMENT IN UNCONSOLIDATED 47
INVESTMENT IN UNCONSOLIDATED AFFILIATES - Joint Venture Financial Information (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2018 | Apr. 01, 2017 | Mar. 31, 2018 | Apr. 01, 2017 | |
Condensed Financial Statements, Captions [Line Items] | ||||
Revenue | $ 1,013.3 | $ 1,084.6 | $ 1,234.9 | $ 1,292 |
Gross margin | 409.2 | 464.3 | 443.2 | 501.1 |
Selling and administrative expenses | 166 | 178.8 | 274.2 | 282.9 |
Amortization expense | 14.1 | 12.3 | ||
Interest expense | 22.6 | 21.5 | 40.4 | 36.8 |
Net income (loss) attributable to controlling interest | 148.9 | 165.1 | 127.7 | 99.8 |
Joint Ventures | ||||
Condensed Financial Statements, Captions [Line Items] | ||||
Revenue | 175.7 | 154.7 | 447.9 | 406.8 |
Gross margin | 8.4 | 9.7 | 84.4 | 70.8 |
Selling and administrative expenses | 52.4 | 51.5 | 116.4 | 92.9 |
Amortization expense | 10.3 | 21.7 | 22.4 | 41.9 |
Interest expense | 18 | 16.6 | 35.5 | 33.5 |
Restructuring and other charges | 8.3 | 0 | 11.9 | 26.6 |
Net income (loss) attributable to controlling interest | $ (80.6) | $ (80.1) | $ (101.8) | $ (124.1) |
IMPAIRMENT, RESTRUCTURING AND48
IMPAIRMENT, RESTRUCTURING AND OTHER - Impairment, Restructuring and Other Charges (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2018 | Apr. 01, 2017 | Mar. 31, 2018 | Apr. 01, 2017 | |
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and other charges | $ 10.2 | $ 1 | $ 10 | $ 0.8 |
Impairment, restructuring and other charges from continuing operations | 10.2 | 1 | 10 | 0.8 |
Restructuring and other charges from discontinued operations | 0.2 | 2.4 | 1.6 | 4.6 |
Total impairment, restructuring and other charges | 10.4 | 3.4 | 11.6 | 5.4 |
Operating Expense | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring and other charges | $ 10.2 | $ 1 | $ 10 | $ 0.8 |
IMPAIRMENT, RESTRUCTURING AND49
IMPAIRMENT, RESTRUCTURING AND OTHER - Activity Related to Liabilities Associated with Restructuring (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2018 | Apr. 01, 2017 | Mar. 31, 2018 | Apr. 01, 2017 | |
Restructuring Reserve [Roll Forward] | ||||
Amounts accrued for restructuring and other, beginning balance | $ 12.1 | |||
Restructuring and other charges from continuing operations | 10 | |||
Restructuring and other charges from discontinued operations | $ 0.2 | $ 2.4 | 1.6 | $ 4.6 |
Payments and other | (6.4) | |||
Amounts accrued for restructuring and other, ending balance | $ 17.3 | $ 17.3 |
IMPAIRMENT, RESTRUCTURING AND50
IMPAIRMENT, RESTRUCTURING AND OTHER - Additional Information (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2018 | Apr. 01, 2017 | Mar. 31, 2018 | Apr. 01, 2017 | |
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring reserve, long term | $ 1.1 | $ 1.1 | ||
Charge recognized for probable loss | 10.2 | |||
Scotts Lawnservice | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Divestiture transaction related costs | $ 0.1 | $ 0.7 | ||
International Business | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Divestiture transaction related costs | 0.2 | 2.3 | 1.6 | 3.9 |
Project Focus | Scotts Lawnservice | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Divestiture transaction related costs | 0.1 | 0.7 | ||
Project Focus | U.S. Consumer | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring charges and adjustments | (0.1) | $ 1 | (0.3) | $ 0.8 |
Restructuring costs incurred to date | 9.8 | 9.8 | ||
Project Focus | Hawthorne | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring costs incurred to date | 1 | 1 | ||
Project Focus | Other | ||||
Restructuring Cost and Reserve [Line Items] | ||||
Restructuring costs incurred to date | $ 1.2 | $ 1.2 |
INVENTORIES (Details)
INVENTORIES (Details) - USD ($) $ in Millions | Mar. 31, 2018 | Sep. 30, 2017 | Apr. 01, 2017 |
Inventory Disclosure [Abstract] | |||
Finished goods | $ 395.8 | $ 210.6 | $ 403.8 |
Work-in-process | 61.2 | 57.6 | 51.5 |
Raw materials | 139.9 | 139.3 | 141.2 |
Total inventories | 596.9 | 407.5 | 596.5 |
Adjustments to reflect inventories at net realizable values | $ 11.9 | $ 10.5 | $ 7.6 |
MARKETING AGREEMENT - Additiona
MARKETING AGREEMENT - Additional Information (Details) $ in Millions | May 15, 2015USD ($) | Mar. 31, 2018USD ($) | Aug. 31, 2017USD ($) | Sep. 30, 1998USD ($) |
Monsanto Marketing Agreement | ||||
Marketing Agreement [Line Items] | ||||
Initial consideration for marketing rights | $ 32 | |||
Useful life of Marketing Agreement | 20 years | |||
Remaining unamortized amount | $ 0.4 | |||
Remaining amortization period of Marketing Agreement | 1 year | |||
Consideration paid | $ 300 | |||
Restated Marketing Agreement | ||||
Marketing Agreement [Line Items] | ||||
Percentage of program earnings | 50.00% | |||
Commission threshold | $ 40 | |||
Annual contribution payment | 18 | |||
Minimum termination fee payable | $ 175 | |||
Minimum termination fee payable multiple | 4 | |||
Minimum termination fee payable threshold | $ 186.4 | |||
International Business | Amended Original Marketing Agreement | ||||
Marketing Agreement [Line Items] | ||||
Carrying amount of intangible assets disposed of | $ 32.6 |
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 | ||
Mar. 31, 2018 | Apr. 01, 2017 | Mar. 31, 2018 | Apr. 01, 2017 | |
Marketing Agreement [Line Items] | ||||
Gross commission | $ 34.5 | $ 41.1 | $ 34.6 | $ 42.3 |
Contribution expenses | (4.5) | (4.5) | (9) | (9) |
Amortization of marketing fee | (0.2) | (0.2) | (0.4) | (0.4) |
Net commission | 29.8 | 36.4 | 25.2 | 32.9 |
Reimbursements associated with Marketing Agreement | 19.7 | 19.4 | 32.5 | 33.6 |
Total net sales associated with Marketing Agreement | $ 49.5 | $ 55.8 | $ 57.7 | $ 66.5 |
DEBT - Components of Long-Term
DEBT - Components of Long-Term Debt (Details) - USD ($) $ in Millions | Mar. 31, 2018 | Sep. 30, 2017 | Apr. 01, 2017 | Dec. 15, 2016 | Oct. 13, 2015 |
Debt Instrument [Line Items] | |||||
Total debt | $ 2,281.5 | $ 1,409.7 | $ 2,084.2 | ||
Less current portions | 335.8 | 143.1 | 32.1 | ||
Less unamortized debt issuance costs | 8 | 8.6 | 9.2 | ||
Long-term debt | 1,937.7 | 1,258 | 2,042.9 | ||
Credit Facilities | Revolving loans | |||||
Debt Instrument [Line Items] | |||||
Total debt | 1,043.2 | 300.5 | 1,096.8 | ||
Credit Facilities | Term loans | |||||
Debt Instrument [Line Items] | |||||
Total debt | $ 266.3 | $ 273.8 | $ 281.3 | ||
Senior Notes | Senior Notes – 5.250% | |||||
Debt Instrument [Line Items] | |||||
Interest rate of debt | 5.25% | 5.25% | 5.25% | 5.25% | |
Total debt | $ 250 | $ 250 | $ 250 | ||
Senior Notes | Senior Notes – 6.000% | |||||
Debt Instrument [Line Items] | |||||
Interest rate of debt | 6.00% | 6.00% | 6.00% | 6.00% | |
Total debt | $ 400 | $ 400 | $ 400 | ||
Receivables facility | |||||
Debt Instrument [Line Items] | |||||
Total debt | 300 | 80 | 0 | ||
Other | |||||
Debt Instrument [Line Items] | |||||
Total debt | $ 22 | $ 105.4 | $ 56.1 |
DEBT - Additional Information (
DEBT - Additional Information (Details) | Aug. 25, 2017USD ($) | Apr. 07, 2017USD ($) | Oct. 29, 2015USD ($) | Oct. 13, 2015USD ($) | Mar. 31, 2018USD ($) | Oct. 02, 2017 | Sep. 30, 2017USD ($) | Apr. 01, 2017USD ($) | Dec. 15, 2016USD ($) | Oct. 14, 2016USD ($) | May 26, 2016 | Sep. 25, 2015USD ($) |
Debt Instrument [Line Items] | ||||||||||||
Senior secured credit facilities, maximum borrowing capacity | $ 1,900,000,000 | |||||||||||
Weighted average interest rate | 4.40% | 4.30% | ||||||||||
Leverage ratio | 3.46 | |||||||||||
Interest coverage ratio | 6.70 | |||||||||||
Leverage ratio, restricted payment threshold | 4 | |||||||||||
Accounts receivable pledged | $ 333,300,000 | $ 88,900,000 | $ 0 | |||||||||
Fair Value, Measurements, Recurring | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Fair value of debt | 55,600,000 | 37,200,000 | ||||||||||
Unobservable Inputs (Level 3) | Fair Value, Measurements, Recurring | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Fair value of debt | 55,600,000 | $ 37,200,000 | ||||||||||
Gavita Holdings B.V. | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Noncontrolling interest percentage owned by noncontrolling owners | 5.00% | |||||||||||
Economic interest acquired | 25.00% | 75.00% | ||||||||||
Fair value of debt | 55,600,000 | $ 55,600,000 | ||||||||||
Master Accounts Receivable Purchase Agreement | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Available borrowing capacity | 78,400,000 | |||||||||||
Maximum aggregate amount | $ 400,000,000 | |||||||||||
Receivables facility borrowings | $ 133,500,000 | |||||||||||
Accounts receivable pledged | 333,300,000 | |||||||||||
Receivables Facility | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Maximum aggregate amount | $ 250,000,000 | |||||||||||
Receivables facility borrowings | 300,000,000 | |||||||||||
Committed up to limit under agreement | $ 100,000,000 | |||||||||||
Receivables Facility | Base Rate | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Margin over LIBOR on Receivables Facility | 0.00% | |||||||||||
Receivables Facility | LIBOR | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Margin over LIBOR on Receivables Facility | 0.90% | |||||||||||
Master Framework Agreement | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Maximum aggregate amount | $ 400,000,000 | |||||||||||
Committed up to limit under agreement | $ 160,000,000 | |||||||||||
Beginning Fiscal Year 2018 | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Maximum restrictive payments | $ 200,000,000 | |||||||||||
Maximum | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Leverage ratio | 4.50 | |||||||||||
Minimum | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Interest coverage ratio | 3 | |||||||||||
Revolving Credit Facility | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Weighted average interest rate | 4.10% | 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] | ||||||||||||
Available borrowing capacity | $ 534,600,000 | |||||||||||
Credit Facilities | Letter of Credit | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Principal amount | $ 22,200,000 | |||||||||||
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% | 5.25% | 5.25% | 5.25% | ||||||||
Senior Notes | Senior Notes – 5.250% | Estimate of Fair Value Measurement | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Fair value of debt | $ 247,500,000 | |||||||||||
Senior Notes | Senior Notes – 6.000% | ||||||||||||
Debt Instrument [Line Items] | ||||||||||||
Interest rate of debt | 6.00% | 6.00% | 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 | $ 419,000,000 |
DEBT - Interest Rate Swap Agree
DEBT - Interest Rate Swap Agreements (Details) - USD ($) $ in Millions | Mar. 31, 2018 | Sep. 30, 2017 | Apr. 01, 2017 |
Instrument 1 | |||
Derivative [Line Items] | |||
Notional Amount | $ 300 | ||
Fixed Rate | 0.83% | ||
Instrument 2 | |||
Derivative [Line Items] | |||
Notional Amount | $ 200 | ||
Fixed Rate | 0.84% | ||
Instrument 3 | |||
Derivative [Line Items] | |||
Notional Amount | $ 150 | ||
Fixed Rate | 2.12% | ||
Instrument 4 | |||
Derivative [Line Items] | |||
Notional Amount | $ 50 | ||
Fixed Rate | 2.25% | ||
Instrument 5 | |||
Derivative [Line Items] | |||
Notional Amount | $ 50 | ||
Fixed Rate | 2.01% | ||
Instrument 6 | |||
Derivative [Line Items] | |||
Notional Amount | $ 200 | ||
Fixed Rate | 2.12% | ||
Instrument 7 | |||
Derivative [Line Items] | |||
Notional Amount | $ 250 | ||
Fixed Rate | 2.09% | ||
Instrument 8 | |||
Derivative [Line Items] | |||
Notional Amount | $ 100 | ||
Fixed Rate | 2.15% | ||
Derivatives designated as hedging instruments | Interest Rate Swap | |||
Derivative [Line Items] | |||
Notional Amount | $ 1,300 | $ 1,100 | $ 1,150 |
RETIREMENT AND RETIREE MEDICA57
RETIREMENT AND RETIREE MEDICAL PLANS (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2018 | Apr. 01, 2017 | Mar. 31, 2018 | Apr. 01, 2017 | |
United States | Pension Plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | $ 0 | $ 0 | $ 0 | $ 0 |
Interest cost | 0.7 | 0.7 | 1.5 | 1.4 |
Expected return on plan assets | (1.1) | (1.2) | (2.3) | (2.4) |
Net amortization | 0.4 | 0.4 | 0.8 | 0.8 |
Net periodic benefit (income) cost | 0 | (0.1) | 0 | (0.2) |
United States | Medical Plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 0.1 | 0.1 | 0.2 | 0.2 |
Interest cost | 0.2 | 0.1 | 0.3 | 0.3 |
Expected return on plan assets | 0 | 0 | 0 | 0 |
Net amortization | (0.3) | (0.2) | (0.5) | (0.4) |
Net periodic benefit (income) cost | 0 | 0 | 0 | 0.1 |
International | Pension Plan | ||||
Defined Benefit Plan Disclosure [Line Items] | ||||
Service cost | 0.3 | 0.2 | 0.5 | 0.4 |
Interest cost | 1.1 | 1 | 2.1 | 1.9 |
Expected return on plan assets | (2.1) | (2) | (4.1) | (3.9) |
Net amortization | 0.3 | 0.4 | 0.6 | 0.9 |
Net periodic benefit (income) cost | $ (0.4) | $ (0.4) | $ (0.9) | $ (0.7) |
EQUITY - Summary of the Changes
EQUITY - Summary of the Changes in Equity (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2018 | Apr. 01, 2017 | Mar. 31, 2018 | Apr. 01, 2017 | |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Equity, controlling interest, beginning balance | $ 648.8 | |||
Noncontrolling interest, beginning balance | 12.9 | |||
Total equity, beginning balance | 661.7 | $ 734.3 | ||
Net income (loss), controlling interest | $ 148.9 | $ 165.1 | 127.7 | 99.8 |
Net income (loss) attributable to noncontrolling interest | 0.1 | 0.1 | 0.1 | 0.5 |
Net income (loss) | 149 | 165.2 | 127.8 | 100.3 |
Other comprehensive income (loss) | 17.9 | 3.2 | ||
Share-based compensation | 15.7 | 19.1 | ||
Dividends declared ($1.06 and $1.00 per share), March 31, 2018 and April 1, 2017, respectively | (61.4) | (60.6) | ||
Treasury share purchases | (256.8) | (90.6) | ||
Treasury share issuances | 4.6 | (6.2) | ||
Adjustment to noncontrolling interest due to ownership change | 0 | |||
Distribution declared by AeroGrow | (8.1) | |||
Acquisition of remaining noncontrolling interest in Gavita | (13.6) | |||
Equity, controlling interest, ending balance | 490.8 | 678.9 | 490.8 | 678.9 |
Noncontrolling interest, ending balance | 5.1 | 12.5 | 5.1 | 12.5 |
Total equity, ending balance | 495.9 | 691.4 | 495.9 | 691.4 |
Common Shares and Capital in Excess of Stated Value | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Equity, controlling interest, beginning balance | 407.6 | 401.7 | ||
Share-based compensation | 15.7 | 19.1 | ||
Treasury share issuances | (8.6) | (20) | ||
Adjustment to noncontrolling interest due to ownership change | (1) | |||
Acquisition of remaining noncontrolling interest in Gavita | (5.7) | |||
Equity, controlling interest, ending balance | 409 | 399.8 | 409 | 399.8 |
Retained Earnings | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Equity, controlling interest, beginning balance | 978.2 | 881.8 | ||
Net income (loss), controlling interest | 127.7 | 99.8 | ||
Dividends declared ($1.06 and $1.00 per share), March 31, 2018 and April 1, 2017, respectively | (61.4) | (60.6) | ||
Equity, controlling interest, ending balance | 1,044.5 | 921 | 1,044.5 | 921 |
Treasury Shares | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Equity, controlling interest, beginning balance | (667.8) | (451.4) | ||
Treasury share purchases | (256.8) | (90.6) | ||
Treasury share issuances | 13.2 | 13.8 | ||
Equity, controlling interest, ending balance | (911.4) | (528.2) | (911.4) | (528.2) |
Accumulated Other Comprehensive Loss | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Equity, controlling interest, beginning balance | (69.2) | (116.9) | ||
Other comprehensive income (loss) | 17.9 | 3.2 | ||
Equity, controlling interest, ending balance | (51.3) | (113.7) | (51.3) | (113.7) |
Total Equity - Controlling Interest | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Equity, controlling interest, beginning balance | 648.8 | 715.2 | ||
Net income (loss), controlling interest | 127.7 | 99.8 | ||
Other comprehensive income (loss) | 17.9 | 3.2 | ||
Share-based compensation | 15.7 | 19.1 | ||
Dividends declared ($1.06 and $1.00 per share), March 31, 2018 and April 1, 2017, respectively | (61.4) | (60.6) | ||
Treasury share purchases | (256.8) | (90.6) | ||
Treasury share issuances | 4.6 | (6.2) | ||
Adjustment to noncontrolling interest due to ownership change | (1) | |||
Acquisition of remaining noncontrolling interest in Gavita | (5.7) | |||
Equity, controlling interest, ending balance | 490.8 | 678.9 | 490.8 | 678.9 |
Non-controlling Interest | ||||
Increase (Decrease) in Stockholders' Equity [Roll Forward] | ||||
Noncontrolling interest, beginning balance | 12.9 | 19.1 | ||
Net income (loss), controlling interest | 0.1 | |||
Net income (loss) attributable to noncontrolling interest | 0.5 | |||
Adjustment to noncontrolling interest due to ownership change | 1 | |||
Distribution declared by AeroGrow | (8.1) | |||
Noncontrolling interest, ending balance | $ 5.1 | $ 12.5 | $ 5.1 | $ 12.5 |
EQUITY - Additional Information
EQUITY - Additional Information (Details) - USD ($) | 1 Months Ended | 3 Months Ended | 6 Months Ended | 44 Months Ended | |
Aug. 31, 2014 | Mar. 31, 2018 | Mar. 31, 2018 | Mar. 31, 2018 | Aug. 03, 2016 | |
Equity [Abstract] | |||||
Write-off of accumulated foreign currency translation loss adjustments | $ 11,700,000 | ||||
Authorized repurchase amount | $ 500,000,000 | $ 1,000,000,000 | |||
Increase in authorized share repurchase authorization | $ 500,000,000 | ||||
Share repurchase period | 5 years | ||||
Common shares repurchased (shares) | 1,700,000 | 2,700,000 | 7,500,000 | ||
Common shares repurchased | $ 160,200,000 | $ 256,800,000 | $ 648,300,000 |
EQUITY - Exercise of Outstandin
EQUITY - Exercise of Outstanding Warrants (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | Jan. 03, 2017 | Nov. 29, 2016 | Mar. 31, 2018 | Apr. 01, 2017 | Mar. 31, 2018 | Apr. 01, 2017 |
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||||||
Dividends declared per common share (USD per share) | $ 0.53 | $ 0.5000 | $ 1.06 | $ 1 | ||
Distribution declared by AeroGrow | $ 8.1 | |||||
Non-controlling Interest | ||||||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||||||
Distribution declared by AeroGrow | $ 8.1 | |||||
AeroGrow International, Inc. | Non-controlling Interest | ||||||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||||||
Distribution declared by AeroGrow | $ 8.1 | |||||
AeroGrow International, Inc. | ||||||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||||||
Equity ownership percentage | 45.00% | |||||
Controlling ownership percentage | 80.00% | |||||
Dividends payable | $ 40.5 | |||||
Dividends declared per common share (USD per share) | $ 1.21 | |||||
AeroGrow International, Inc. | SMG Growing Media | ||||||
Consolidation, Less than Wholly Owned Subsidiary, Parent Ownership Interest, Effects of Changes, Net [Line Items] | ||||||
Aggregate warrant exercise price | $ 47.8 | |||||
Number of shares issued to subsidiary upon exercise (shares) | 21.6 |
EQUITY - Share-based Awards (De
EQUITY - Share-based Awards (Details) - USD ($) $ in Millions | Oct. 30, 2017 | Mar. 31, 2018 | Apr. 01, 2017 |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total share-based awards (shares) | 365,865 | 612,719 | |
Aggregate fair value at grant dates | $ 34.9 | $ 56.9 | |
Performance Based Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total share-based awards (shares) | 235,503 | ||
Restricted stock units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total share-based awards (shares) | 130,362 | ||
Restricted stock units | Employees | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total share-based awards (shares) | 109,563 | 102,143 | |
Performance units | Employees | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total share-based awards (shares) | 235,503 | 487,674 | |
Deferred stock units | Board of Directors | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total share-based awards (shares) | 20,799 | 22,902 | |
Project Focus | Hawthorne | Performance Based Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Total share-based awards (shares) | 200,000 | ||
Performance period | 4 years | ||
Fair value of awards vested in period | $ 20.2 | ||
Project Focus | Hawthorne | Minimum | Performance Based Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting percentage | 50.00% | ||
Project Focus | Hawthorne | Maximum | Performance Based Units | |||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |||
Vesting percentage | 250.00% |
EQUITY - Total Share-based Comp
EQUITY - Total Share-based Compensation (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | ||
Mar. 31, 2018 | Apr. 01, 2017 | Mar. 31, 2018 | Apr. 01, 2017 | |
Equity [Abstract] | ||||
Share-based compensation | $ 9.7 | $ 12.8 | $ 15.7 | $ 15.1 |
Tax benefit recognized | $ 1.8 | $ 4.9 | $ 4.1 | $ 5.8 |
EQUITY - Aggregate Stock Option
EQUITY - Aggregate Stock Option Activity (Details) - Stock Options | 6 Months Ended |
Mar. 31, 2018$ / sharesshares | |
No. of Options | |
Outstanding at beginning of period (shares) | shares | 1,517,310 |
Granted (shares) | shares | 0 |
Exercised (shares) | shares | (72,027) |
Forfeited (shares) | shares | (1,367) |
Outstanding at end of period (shares) | shares | 1,443,916 |
Exercisable (shares) | shares | 1,017,603 |
Wtd. Avg. Exercise Price | |
Outstanding at beginning of period (USD per share) | $ / shares | $ 53.05 |
Granted (USD per share) | $ / shares | 0 |
Exercised (USD per share) | $ / shares | 50.38 |
Forfeited (USD per share) | $ / shares | 36.86 |
Outstanding at end of period (USD per share) | $ / shares | 53.20 |
Exercisable (USD per share) | $ / shares | $ 46.72 |
EQUITY - Certain Information Pe
EQUITY - Certain Information Pertaining to Stock Option Awards (Details) - Stock Options - USD ($) $ / shares in Units, $ in Millions | 6 Months Ended | |
Mar. 31, 2018 | Sep. 30, 2017 | |
Share-based Compensation, Shares Authorized under Stock Option Plans, Exercise Price Range [Line Items] | ||
Compensation costs not yet recognized | $ 0.6 | |
Weighted average period of compensation cost recognition | 10 months | |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Exercises in Period, Intrinsic Value | $ 3.8 | |
Remaining unexercisable stock options, net (shares) | 400,000 | |
Weighted average exercise price (USD per share) | $ 68.65 | |
Intrinsic value | $ 7.1 | |
Average remaining term | 7 years 9 months 10 days | |
Awards Outstanding | ||
No. of Options (shares) | 1,443,916 | 1,517,310 |
Wtd. Avg. Remaining Life | 5 years 7 days | |
Wtd. Avg. Exercise Price (USD per share) | $ 53.20 | $ 53.05 |
Awards Exercisable | ||
No. of Options (shares) | 1,017,603 | |
Wtd. Avg. Remaining Life | 3 years 10 months 3 days | |
Wtd. Avg. Exercise Price (USD per share) | $ 46.72 | |
$20.59 - $20.59 | ||
Range of Exercise Price | ||
Range of exercise price, minimum (USD per share) | 20.59 | |
Range of exercise price, maximum (USD per share) | $ 20.59 | |
Awards Outstanding | ||
No. of Options (shares) | 200,000 | |
Wtd. Avg. Remaining Life | 6 months 3 days | |
Wtd. Avg. Exercise Price (USD per share) | $ 20.59 | |
Awards Exercisable | ||
No. of Options (shares) | 200,000 | |
Wtd. Avg. Remaining Life | 6 months 3 days | |
Wtd. Avg. Exercise Price (USD per share) | $ 20.59 | |
$38.81 - $$49.19 | ||
Range of Exercise Price | ||
Range of exercise price, minimum (USD per share) | 38.81 | |
Range of exercise price, maximum (USD per share) | $ 49.19 | |
Awards Outstanding | ||
No. of Options (shares) | 400,000 | |
Wtd. Avg. Remaining Life | 2 years 11 months 5 days | |
Wtd. Avg. Exercise Price (USD per share) | $ 45.22 | |
Awards Exercisable | ||
No. of Options (shares) | 400,000 | |
Wtd. Avg. Remaining Life | 2 years 11 months 5 days | |
Wtd. Avg. Exercise Price (USD per share) | $ 45.22 | |
$63.43 - $68.68 | ||
Range of Exercise Price | ||
Range of exercise price, minimum (USD per share) | 63.43 | |
Range of exercise price, maximum (USD per share) | $ 68.68 | |
Awards Outstanding | ||
No. of Options (shares) | 800,000 | |
Wtd. Avg. Remaining Life | 7 years 4 months 10 days | |
Wtd. Avg. Exercise Price (USD per share) | $ 66.26 | |
Awards Exercisable | ||
No. of Options (shares) | 400,000 | |
Wtd. Avg. Remaining Life | 6 years 10 months 2 days | |
Wtd. Avg. Exercise Price (USD per share) | $ 63.49 |
EQUITY - Intrinsic Values of St
EQUITY - Intrinsic Values of Stock Option Awards (Details) - Stock Options $ in Millions | Mar. 31, 2018USD ($) |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | |
Outstanding | $ 47 |
Exercisable | $ 39.7 |
EQUITY - Schedule of Restricted
EQUITY - Schedule of Restricted Share-Based Award Activity (Details) - USD ($) $ / shares in Units, $ in Millions | 6 Months Ended | |
Mar. 31, 2018 | Apr. 01, 2017 | |
No. of Units | ||
Granted (shares) | 365,865 | 612,719 |
Restricted stock units | ||
No. of Units | ||
Awards outstanding, beginning balance (shares) | 291,519 | |
Granted (shares) | 130,362 | |
Vested (shares) | (86,601) | |
Forfeited (shares) | 0 | |
Awards outstanding, ending balance (shares) | 335,280 | |
Wtd. Avg. Grant Date Fair Value per Unit | ||
Awards outstanding, beginning balance (USD per share) | $ 81.15 | |
Granted (USD per share) | 90.86 | |
Vested (USD per share) | 67.70 | |
Forfeited (USD per share) | 0 | |
Awards outstanding, ending balance (USD per share) | $ 88.39 | |
Compensation costs not yet recognized | $ 8.3 | |
Weighted average period of compensation cost recognition | 1 year 10 months 20 days |
EQUITY - Performance-based Awar
EQUITY - Performance-based Award Activity (Details) - USD ($) $ / shares in Units, $ in Millions | 6 Months Ended | |
Mar. 31, 2018 | Apr. 01, 2017 | |
No. of Units | ||
Granted (shares) | 365,865 | 612,719 |
Performance Based Units | ||
No. of Units | ||
Awards outstanding, beginning balance (shares) | 596,933 | |
Granted (shares) | 235,503 | |
Vested (shares) | (53,644) | |
Forfeited (shares) | (3,037) | |
Awards outstanding, ending balance (shares) | 775,755 | |
Wtd. Avg. Grant Date Fair Value per Unit | ||
Awards outstanding, beginning balance (USD per share) | $ 88.01 | |
Granted (USD per share) | 97.72 | |
Vested (USD per share) | 63.43 | |
Forfeited (USD per share) | 98.81 | |
Awards outstanding, ending balance (USD per share) | $ 92.61 | |
Compensation costs not yet recognized | $ 28 | |
Weighted average period of compensation cost recognition | 3 years 3 months 26 days |
INCOME TAXES (Details)
INCOME TAXES (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | 12 Months Ended | ||
Mar. 31, 2018 | Mar. 31, 2018 | Apr. 01, 2017 | Sep. 30, 2018 | Sep. 30, 2017 | |
Income Tax Contingency [Line Items] | |||||
Effective tax rate related to continuing operations | (15.00%) | 35.70% | |||
Net deferred tax liability | $ 157.5 | ||||
Deferred tax liability reduction recorded as tax benefit | $ 45.9 | $ 45.9 | |||
Estimated repatriation transition tax | 14 | ||||
Foreign tax credits granted from repatriation | 10.7 | ||||
Valuation allowance of excess foreign tax credits | 3.2 | ||||
Increase in state tax expense as result of repatriation | 0.1 | $ 0.1 | |||
Write-off of accumulated foreign currency translation loss adjustments | $ 11.7 | ||||
Scenario, Forecast | |||||
Income Tax Contingency [Line Items] | |||||
Prorated effective corporate tax rate | 24.50% |
CONTINGENCIES (Details)
CONTINGENCIES (Details) $ in Millions | 3 Months Ended |
Mar. 31, 2018USD ($) | |
Commitments and Contingencies Disclosure [Abstract] | |
Accrual for environmental actions | $ 4.2 |
Charge for probable loss | $ 10.2 |
DERIVATIVE INSTRUMENTS AND HE70
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Additional Information (Details) - USD ($) $ in Millions | Mar. 31, 2018 | Sep. 30, 2017 | Apr. 01, 2017 |
Not Designated as Hedging Instrument | Currency forward contracts | |||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Notional amount | $ 252.9 | $ 268.3 | $ 288.4 |
Fair value of forward contracts | (0.7) | 1.8 | (3.5) |
Derivatives designated as hedging instruments | Interest Rate Swap | |||
Derivative Instruments and Hedging Activities Disclosures [Line Items] | |||
Notional amount | 1,300 | $ 1,100 | $ 1,150 |
Gain related to interest rate swap agreements expected to be reclassified | 0.9 | ||
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 | $ 0.3 |
DERIVATIVE INSTRUMENTS AND HE71
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Outstanding Commodity Contracts (Details) gal in Thousands | Mar. 31, 2018tonsgal | Sep. 30, 2017tonsgal | Apr. 01, 2017tonsgal |
Urea (in tons) | |||
Derivative [Line Items] | |||
Outstanding commodity contracts | tons | 42,000 | 76,500 | 28,500 |
Diesel (in gallons) | |||
Derivative [Line Items] | |||
Outstanding commodity contracts | 3,360 | 5,586 | 5,544 |
Heating Oil (in gallons) | |||
Derivative [Line Items] | |||
Outstanding commodity contracts | 1,092 | 1,386 | 1,680 |
DERIVATIVE INSTRUMENTS AND HE72
DERIVATIVE INSTRUMENTS AND HEDGING ACTIVITIES - Fair Values of Derivative Instruments (Details) - USD ($) $ in Millions | Mar. 31, 2018 | Sep. 30, 2017 | Apr. 01, 2017 |
Derivatives, Fair Value [Line Items] | |||
Total derivatives | $ 3.3 | $ 5.7 | $ (4.9) |
Derivatives designated as hedging instruments | |||
Derivatives, Fair Value [Line Items] | |||
Total derivatives | 2.9 | 3.3 | (1.3) |
Derivatives designated as hedging instruments | Interest rate swap agreements | Prepaid and other current assets | |||
Derivatives, Fair Value [Line Items] | |||
Derivative asset | 1.5 | 1.3 | 0.7 |
Derivatives designated as hedging instruments | Interest rate swap agreements | Other assets | |||
Derivatives, Fair Value [Line Items] | |||
Derivative asset | 1.9 | 0 | 0.8 |
Derivatives designated as hedging instruments | Interest rate swap agreements | Other current liabilities | |||
Derivatives, Fair Value [Line Items] | |||
Derivative liability | 0 | (0.8) | (1.9) |
Derivatives designated as hedging instruments | Interest rate swap agreements | Other liabilities | |||
Derivatives, Fair Value [Line Items] | |||
Derivative liability | 0 | (0.4) | (0.7) |
Derivatives designated as hedging instruments | Commodity hedging instruments | Prepaid and other current assets | |||
Derivatives, Fair Value [Line Items] | |||
Derivative asset | 0 | 3.2 | 0 |
Derivatives designated as hedging instruments | Commodity hedging instruments | Other current liabilities | |||
Derivatives, Fair Value [Line Items] | |||
Derivative liability | (0.5) | 0 | (0.2) |
Not Designated as Hedging Instrument | |||
Derivatives, Fair Value [Line Items] | |||
Total derivatives | 0.4 | 2.4 | (3.6) |
Not Designated as Hedging Instrument | Currency forward contracts | Prepaid and other current assets | |||
Derivatives, Fair Value [Line Items] | |||
Derivative asset | 0.3 | 2 | 0.5 |
Not Designated as Hedging Instrument | Currency forward contracts | Other current liabilities | |||
Derivatives, Fair Value [Line Items] | |||
Derivative liability | (1) | (0.2) | (4) |
Not Designated as Hedging Instrument | Commodity hedging instruments | Prepaid and other current assets | |||
Derivatives, Fair Value [Line Items] | |||
Derivative asset | 1.1 | 0.6 | 0 |
Not Designated as Hedging Instrument | Commodity hedging instruments | Other current liabilities | |||
Derivatives, Fair Value [Line Items] | |||
Derivative liability | $ 0 | $ 0 | $ (0.1) |
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 | ||
Mar. 31, 2018 | Apr. 01, 2017 | Mar. 31, 2018 | Apr. 01, 2017 | |
Not Designated as Hedging Instrument | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain / (Loss) Recognized in Earnings | $ (2.4) | $ (3.1) | $ (3.7) | $ 7 |
Not Designated as Hedging Instrument | Currency forward contracts | Other income / expense, net | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain / (Loss) Recognized in Earnings | (2.6) | (2.2) | (5.2) | 7 |
Not Designated as Hedging Instrument | Commodity hedging instruments | Cost of sales | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain / (Loss) Recognized in Earnings | 0.2 | (0.9) | 1.5 | 0 |
Cash Flow Hedging | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain / (Loss) Recognized in AOCI | 2 | 0 | 2.8 | 3 |
Amount of Gain / (Loss) Reclassified From AOCI Into Earnings | 1.1 | (1.1) | 1.2 | (1.5) |
Cash Flow Hedging | Interest rate swap agreements | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain / (Loss) Recognized in AOCI | 2.1 | 0.4 | 2.5 | 2.5 |
Cash Flow Hedging | Interest rate swap agreements | Interest expense | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain / (Loss) Reclassified From AOCI Into Earnings | 0.1 | (0.9) | 0.2 | (1.2) |
Cash Flow Hedging | Commodity hedging instruments | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain / (Loss) Recognized in AOCI | (0.1) | (0.4) | 0.3 | 0.5 |
Cash Flow Hedging | Commodity hedging instruments | Cost of sales | ||||
Derivative Instruments, Gain (Loss) [Line Items] | ||||
Amount of Gain / (Loss) Reclassified From AOCI Into Earnings | $ 1 | $ (0.2) | $ 1 | $ (0.3) |
FAIR VALUE MEASUREMENTS (Detail
FAIR VALUE MEASUREMENTS (Details) - USD ($) $ in Millions | Mar. 31, 2018 | Oct. 02, 2017 | Sep. 30, 2017 | Apr. 01, 2017 | May 26, 2016 |
Fair Value, Measurements, Recurring | |||||
Assets | |||||
Cash equivalents | $ 0.9 | $ 26.2 | $ 17.7 | ||
Other | 29.8 | 27.5 | 25.4 | ||
Total | 35.5 | 60.8 | 45.1 | ||
Liabilities | |||||
Long-term debt | (55.6) | (37.2) | |||
Total | (1.5) | (57) | (44.1) | ||
Fair Value, Measurements, Recurring | Interest rate swap agreements | |||||
Assets | |||||
Derivatives | 3.4 | 1.3 | 1.5 | ||
Liabilities | |||||
Derivatives | (1.2) | (2.6) | |||
Fair Value, Measurements, Recurring | Currency forward contracts | |||||
Assets | |||||
Derivatives | 0.3 | 2 | 0.5 | ||
Liabilities | |||||
Derivatives | (1) | (0.2) | (4) | ||
Fair Value, Measurements, Recurring | Commodity hedging instruments | |||||
Assets | |||||
Derivatives | 1.1 | 3.8 | |||
Liabilities | |||||
Derivatives | (0.5) | (0.3) | |||
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | |||||
Assets | |||||
Cash equivalents | 0.9 | 26.2 | 17.7 | ||
Other | 18 | 15.7 | 14.5 | ||
Total | 18.9 | 41.9 | 32.2 | ||
Liabilities | |||||
Long-term debt | 0 | 0 | |||
Total | 0 | 0 | 0 | ||
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | Interest rate swap agreements | |||||
Assets | |||||
Derivatives | 0 | 0 | 0 | ||
Liabilities | |||||
Derivatives | 0 | 0 | |||
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | Currency forward contracts | |||||
Assets | |||||
Derivatives | 0 | 0 | 0 | ||
Liabilities | |||||
Derivatives | 0 | 0 | 0 | ||
Fair Value, Measurements, Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | Commodity hedging instruments | |||||
Assets | |||||
Derivatives | 0 | 0 | |||
Liabilities | |||||
Derivatives | 0 | 0 | |||
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | |||||
Assets | |||||
Cash equivalents | 0 | 0 | 0 | ||
Other | 0 | 0 | 0 | ||
Total | 4.8 | 7.1 | 2 | ||
Liabilities | |||||
Long-term debt | 0 | 0 | |||
Total | (1.5) | (1.4) | (6.9) | ||
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | Interest rate swap agreements | |||||
Assets | |||||
Derivatives | 3.4 | 1.3 | 1.5 | ||
Liabilities | |||||
Derivatives | (1.2) | (2.6) | |||
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | Currency forward contracts | |||||
Assets | |||||
Derivatives | 0.3 | 2 | 0.5 | ||
Liabilities | |||||
Derivatives | (1) | (0.2) | (4) | ||
Fair Value, Measurements, Recurring | Significant Other Observable Inputs (Level 2) | Commodity hedging instruments | |||||
Assets | |||||
Derivatives | 1.1 | 3.8 | |||
Liabilities | |||||
Derivatives | (0.5) | (0.3) | |||
Fair Value, Measurements, Recurring | Unobservable Inputs (Level 3) | |||||
Assets | |||||
Cash equivalents | 0 | 0 | 0 | ||
Other | 11.8 | 11.8 | 10.9 | ||
Total | 11.8 | 11.8 | 10.9 | ||
Liabilities | |||||
Long-term debt | (55.6) | (37.2) | |||
Total | 0 | (55.6) | (37.2) | ||
Fair Value, Measurements, Recurring | Unobservable Inputs (Level 3) | Interest rate swap agreements | |||||
Assets | |||||
Derivatives | 0 | 0 | 0 | ||
Liabilities | |||||
Derivatives | 0 | 0 | |||
Fair Value, Measurements, Recurring | Unobservable Inputs (Level 3) | Currency forward contracts | |||||
Assets | |||||
Derivatives | 0 | 0 | 0 | ||
Liabilities | |||||
Derivatives | 0 | 0 | 0 | ||
Fair Value, Measurements, Recurring | Unobservable Inputs (Level 3) | Commodity hedging instruments | |||||
Assets | |||||
Derivatives | 0 | 0 | |||
Liabilities | |||||
Derivatives | 0 | $ 0 | |||
Gavita Holdings B.V. | |||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||||
Economic interest acquired | 25.00% | 75.00% | |||
Liabilities | |||||
Long-term debt | $ (55.6) | $ (55.6) |
SEGMENT INFORMATION (Details)
SEGMENT INFORMATION (Details) $ in Millions | 3 Months Ended | 6 Months Ended | |||
Mar. 31, 2018USD ($) | Apr. 01, 2017USD ($) | Mar. 31, 2018USD ($)segment | Apr. 01, 2017USD ($) | Sep. 30, 2017USD ($) | |
Segment Reporting [Abstract] | |||||
Number of reportable segments | segment | 3 | ||||
Segment Reporting Information [Line Items] | |||||
Net sales | $ 1,013.3 | $ 1,084.6 | $ 1,234.9 | $ 1,292 | |
Impairment, restructuring and other | (10.2) | (1) | (10) | (0.8) | |
Equity in income (loss) of unconsolidated affiliates | 1.5 | (24.1) | 2.1 | (37.3) | |
Interest expense | (22.6) | (21.5) | (40.4) | (36.8) | |
Other non-operating expense, net | (9.2) | 0 | (6.7) | 0 | |
Total assets: | |||||
Total assets | 3,575.5 | 3,792 | 3,575.5 | 3,792 | $ 2,747 |
Assets held for sale | 0 | 331.5 | 0 | 331.5 | 0 |
Corporate | |||||
Total assets: | |||||
Total assets | 209.8 | 178.9 | 209.8 | 178.9 | 298 |
Continuing Operations | |||||
Segment Reporting Information [Line Items] | |||||
Segment profit (loss) | 202 | 239.7 | 115.4 | 149.4 | |
Intangible asset amortization | (6.9) | (5.6) | (13.7) | (11.1) | |
Impairment, restructuring and other | (10.2) | (1) | (10) | (0.8) | |
Equity in income (loss) of unconsolidated affiliates | 1.5 | (24.1) | 2.1 | (37.3) | |
Interest expense | (22.6) | (21.5) | (40.4) | (36.8) | |
Other non-operating expense, net | (9.2) | 0 | (6.7) | 0 | |
Continuing Operations | Operating Segments | |||||
Segment Reporting Information [Line Items] | |||||
Segment profit (loss) | 283 | 327.3 | 242.8 | 293.2 | |
Continuing Operations | Corporate | |||||
Segment Reporting Information [Line Items] | |||||
Segment profit (loss) | (33.6) | (35.4) | (58.7) | (57.8) | |
U.S. Consumer | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 920.2 | 974.8 | 1,046.1 | 1,101 | |
U.S. Consumer | Operating Segments | |||||
Total assets: | |||||
Total assets | 2,487.6 | 2,569.4 | 2,487.6 | 2,569.4 | 1,650.3 |
U.S. Consumer | Continuing Operations | Operating Segments | |||||
Segment Reporting Information [Line Items] | |||||
Segment profit (loss) | 286.2 | 313.9 | 248.3 | 275.4 | |
Hawthorne | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 41.8 | 59.1 | 118.5 | 122.8 | |
Hawthorne | Operating Segments | |||||
Total assets: | |||||
Total assets | 664.4 | 502.3 | 664.4 | 502.3 | 648 |
Hawthorne | Continuing Operations | Operating Segments | |||||
Segment Reporting Information [Line Items] | |||||
Segment profit (loss) | (4.8) | 9.6 | (3) | 16.3 | |
Other | |||||
Segment Reporting Information [Line Items] | |||||
Net sales | 51.3 | 50.7 | 70.3 | 68.2 | |
Other | Operating Segments | |||||
Total assets: | |||||
Total assets | 213.7 | 209.9 | 213.7 | 209.9 | $ 150.7 |
Other | Continuing Operations | Operating Segments | |||||
Segment Reporting Information [Line Items] | |||||
Segment profit (loss) | $ 1.6 | $ 3.8 | $ (2.5) | $ 1.5 |
SUBSEQUENT EVENT (Details)
SUBSEQUENT EVENT (Details) - Hawthorne Hydroponics LLC - Sunlight Supply, Inc., Sunlight Garden Supply, Inc., Sunlight Garden Supply, ULC, IP Holdings, LLC, and Columbia River Industrial Holdings, LLC - Subsequent Event $ in Millions | Apr. 12, 2018USD ($) |
Subsequent Event [Line Items] | |
Consideration paid | $ 450 |
Cash paid in business combination | 425 |
Common stock paid in business combination | 25 |
Contingent consideration for acquired business | $ 20 |
FINANCIAL INFORMATION FOR SUB77
FINANCIAL INFORMATION FOR SUBSIDIARY GUARANTORS AND NON-GUARANTORS - Additional information (Details) - USD ($) $ in Millions | 6 Months Ended | ||||
Mar. 31, 2018 | Apr. 01, 2017 | Sep. 30, 2017 | Dec. 15, 2016 | Oct. 13, 2015 | |
Disclosure of Dividends Paid | |||||
Revolving loan term | 5 years | ||||
Return of investment from affiliates | $ 0 | $ 0 | |||
Reportable Legal Entities | Parent | |||||
Disclosure of Dividends Paid | |||||
Return of investment from affiliates | 554 | 351.5 | |||
Return on investment | 12.2 | ||||
Reportable Legal Entities | Subsidiary Guarantors | |||||
Disclosure of Dividends Paid | |||||
Return of investment from affiliates | 0 | $ 32.4 | |||
Return on investment | $ (1.8) | ||||
Senior Notes – 6.000% | Senior Notes | |||||
Disclosure of Dividends Paid | |||||
Interest rate of debt | 6.00% | 6.00% | 6.00% | 6.00% | |
Senior Notes – 5.250% | Senior Notes | |||||
Disclosure of Dividends Paid | |||||
Interest rate of debt | 5.25% | 5.25% | 5.25% | 5.25% |
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 | ||
Mar. 31, 2018 | Apr. 01, 2017 | Mar. 31, 2018 | Apr. 01, 2017 | |
Schedule of Condensed Consolidating Statement of Operations [Line Items] | ||||
Net sales | $ 1,013.3 | $ 1,084.6 | $ 1,234.9 | $ 1,292 |
Cost of sales | 604.1 | 620.3 | 791.7 | 790.9 |
Gross profit | 409.2 | 464.3 | 443.2 | 501.1 |
Operating expenses: | ||||
Selling, general and administrative | 166 | 178.8 | 274.2 | 282.9 |
Impairment, restructuring and other | 10.2 | 1 | 10 | 0.8 |
Other (income) expense, net | 0.7 | (0.8) | (1.4) | (6.1) |
Income (loss) from operations | 232.3 | 285.3 | 160.4 | 223.5 |
Equity (income) loss in subsidiaries | 0 | 0 | 0 | 0 |
Equity in (income) loss of unconsolidated affiliates | (1.5) | 24.1 | (2.1) | 37.3 |
Interest expense | 22.6 | 21.5 | 40.4 | 36.8 |
Other non-operating (income) expense, net | 9.2 | 0 | 6.7 | 0 |
Income (loss) from continuing operations before income taxes | 202 | 239.7 | 115.4 | 149.4 |
Income tax expense (benefit) from continuing operations | 49.3 | 85.6 | (17.3) | 53.4 |
Income (loss) from continuing operations | 152.7 | 154.1 | 132.7 | 96 |
Income (loss) from discontinued operations, net of tax | (3.7) | 11.1 | (4.9) | 4.3 |
Net income (loss) | 149 | 165.2 | 127.8 | 100.3 |
Net (income) loss attributable to noncontrolling interest | (0.1) | (0.1) | (0.1) | (0.5) |
Net income (loss) attributable to controlling interest | 148.9 | 165.1 | 127.7 | 99.8 |
Reportable Legal Entities | Parent | ||||
Schedule of Condensed Consolidating Statement of Operations [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
Cost of sales | 0 | 0 | 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) expense, net | (0.2) | (0.2) | (0.4) | (0.4) |
Income (loss) from operations | 0.2 | 0.2 | 0.4 | 0.4 |
Equity (income) loss in subsidiaries | (158.9) | (173.8) | (157.8) | (115.4) |
Equity in (income) loss of unconsolidated affiliates | 0 | 0 | 0 | 0 |
Interest expense | 20.9 | 20.5 | 37.8 | 35.3 |
Other non-operating (income) expense, net | (7.9) | (7.5) | (11.8) | (11.8) |
Income (loss) from continuing operations before income taxes | 146.1 | 161 | 132.2 | 92.3 |
Income tax expense (benefit) from continuing operations | (3.1) | (4.6) | 3.8 | (8.2) |
Income (loss) from continuing operations | 149.2 | 165.6 | 128.4 | 100.5 |
Income (loss) from discontinued operations, net of tax | 0 | 0 | 0 | 0 |
Net income (loss) | 149.2 | 165.6 | 128.4 | 100.5 |
Net (income) loss attributable to noncontrolling interest | 0 | 0 | 0 | 0 |
Net income (loss) attributable to controlling interest | 149.2 | 165.6 | 128.4 | 100.5 |
Reportable Legal Entities | Subsidiary Guarantors | ||||
Schedule of Condensed Consolidating Statement of Operations [Line Items] | ||||
Net sales | 951.9 | 998.8 | 1,099.5 | 1,144.3 |
Cost of sales | 555.6 | 558.5 | 682.6 | 685 |
Gross profit | 396.3 | 440.3 | 416.9 | 459.3 |
Operating expenses: | ||||
Selling, general and administrative | 150.1 | 160.3 | 240.5 | 247.1 |
Impairment, restructuring and other | 10.2 | 1 | 10 | 0.8 |
Other (income) expense, net | 0.9 | (1.1) | (0.2) | (6.4) |
Income (loss) from operations | 235.1 | 280.1 | 166.6 | 217.8 |
Equity (income) loss in subsidiaries | 3.8 | (8.3) | 5.5 | (7) |
Equity in (income) loss of unconsolidated affiliates | 0 | 24 | 0 | 37.2 |
Interest expense | 13.1 | 11.4 | 21.8 | 21.3 |
Other non-operating (income) expense, net | (2.5) | 0 | (5) | 0 |
Income (loss) from continuing operations before income taxes | 220.7 | 253 | 144.3 | 166.3 |
Income tax expense (benefit) from continuing operations | 54.7 | 86.9 | (22.4) | 56.4 |
Income (loss) from continuing operations | 166 | 166.1 | 166.7 | 109.9 |
Income (loss) from discontinued operations, net of tax | (3.7) | 1.1 | (3.9) | 0.1 |
Net income (loss) | 162.3 | 167.2 | 162.8 | 110 |
Net (income) loss attributable to noncontrolling interest | 0 | 0 | 0 | 0 |
Net income (loss) attributable to controlling interest | 162.3 | 167.2 | 162.8 | 110 |
Reportable Legal Entities | Non-Guarantors | ||||
Schedule of Condensed Consolidating Statement of Operations [Line Items] | ||||
Net sales | 61.4 | 85.8 | 135.4 | 147.7 |
Cost of sales | 48.5 | 61.8 | 109.1 | 105.9 |
Gross profit | 12.9 | 24 | 26.3 | 41.8 |
Operating expenses: | ||||
Selling, general and administrative | 15.6 | 18.1 | 33 | 35.1 |
Impairment, restructuring and other | 0 | 0 | 0 | |
Other (income) expense, net | 0 | 0.5 | (0.8) | 0.7 |
Income (loss) from operations | (2.7) | 5.4 | (5.9) | 6 |
Equity (income) loss in subsidiaries | 0 | 0 | 0 | 0 |
Equity in (income) loss of unconsolidated affiliates | (1.5) | 0.1 | (2.1) | 0.1 |
Interest expense | 1.3 | 1.1 | 2.2 | 1.9 |
Other non-operating (income) expense, net | 6.9 | (4) | 2.1 | (9.9) |
Income (loss) from continuing operations before income taxes | (9.4) | 8.2 | (8.1) | 13.9 |
Income tax expense (benefit) from continuing operations | (2.3) | 3.3 | 1.3 | 5.2 |
Income (loss) from continuing operations | (7.1) | 4.9 | (9.4) | 8.7 |
Income (loss) from discontinued operations, net of tax | 0 | 10 | (1) | 4.2 |
Net income (loss) | (7.1) | 14.9 | (10.4) | 12.9 |
Net (income) loss attributable to noncontrolling interest | 0 | 0 | 0 | 0 |
Net income (loss) attributable to controlling interest | (7.1) | 14.9 | (10.4) | 12.9 |
Eliminations/ Consolidations | ||||
Schedule of Condensed Consolidating Statement of Operations [Line Items] | ||||
Net sales | 0 | 0 | 0 | 0 |
Cost of sales | 0 | 0 | 0 | 0 |
Gross profit | 0 | 0 | 0 | 0 |
Operating expenses: | ||||
Selling, general and administrative | 0.3 | 0.4 | 0.7 | 0.7 |
Impairment, restructuring and other | 0 | 0 | 0 | 0 |
Other (income) expense, net | 0 | 0 | 0 | 0 |
Income (loss) from operations | (0.3) | (0.4) | (0.7) | (0.7) |
Equity (income) loss in subsidiaries | 155.1 | 182.1 | 152.3 | 122.4 |
Equity in (income) loss of unconsolidated affiliates | 0 | 0 | 0 | 0 |
Interest expense | (12.7) | (11.5) | (21.4) | (21.7) |
Other non-operating (income) expense, net | 12.7 | 11.5 | 21.4 | 21.7 |
Income (loss) from continuing operations before income taxes | (155.4) | (182.5) | (153) | (123.1) |
Income tax expense (benefit) from continuing operations | 0 | 0 | 0 | 0 |
Income (loss) from continuing operations | (155.4) | (182.5) | (153) | (123.1) |
Income (loss) from discontinued operations, net of tax | 0 | 0 | 0 | 0 |
Net income (loss) | (155.4) | (182.5) | (153) | (123.1) |
Net (income) loss attributable to noncontrolling interest | (0.1) | (0.1) | (0.1) | (0.5) |
Net income (loss) attributable to controlling interest | $ (155.5) | $ (182.6) | $ (153.1) | $ (123.6) |
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 | ||
Mar. 31, 2018 | Apr. 01, 2017 | Mar. 31, 2018 | Apr. 01, 2017 | |
Schedule of Condensed Consolidating Statement of Comprehensive Income (Loss) | ||||
Net income (loss) | $ 149 | $ 165.2 | $ 127.8 | $ 100.3 |
Other comprehensive income (loss): | ||||
Net foreign currency translation adjustment | 15.8 | 1.8 | 15.7 | (2.2) |
Net change in derivatives | 0.9 | 1.1 | 1.6 | 4.5 |
Net change in pension and other post-retirement benefits | 0.3 | 0.5 | 0.6 | 0.9 |
Total other comprehensive income (loss) | 17 | 3.4 | 17.9 | 3.2 |
Comprehensive income (loss) | 166 | 168.6 | 145.7 | 103.5 |
Reportable Legal Entities | Parent | ||||
Schedule of Condensed Consolidating Statement of Comprehensive Income (Loss) | ||||
Net income (loss) | 149.2 | 165.6 | 128.4 | 100.5 |
Other comprehensive income (loss): | ||||
Net foreign currency translation adjustment | 15.8 | 1.8 | 15.7 | (2.2) |
Net change in derivatives | 0.9 | 1.1 | 1.6 | 4.5 |
Net change in pension and other post-retirement benefits | 0.3 | 0.5 | 0.6 | 0.9 |
Total other comprehensive income (loss) | 17 | 3.4 | 17.9 | 3.2 |
Comprehensive income (loss) | 166.2 | 169 | 146.3 | 103.7 |
Reportable Legal Entities | Subsidiary Guarantors | ||||
Schedule of Condensed Consolidating Statement of Comprehensive Income (Loss) | ||||
Net income (loss) | 162.3 | 167.2 | 162.8 | 110 |
Other comprehensive income (loss): | ||||
Net foreign currency translation adjustment | 0 | 0 | 0 | 0 |
Net change in derivatives | (1.1) | (0.2) | (0.7) | 0.8 |
Net change in pension and other post-retirement benefits | 0.1 | 0.3 | 0.2 | 0.3 |
Total other comprehensive income (loss) | (1) | 0.1 | (0.5) | 1.1 |
Comprehensive income (loss) | 161.3 | 167.3 | 162.3 | 111.1 |
Reportable Legal Entities | Non-Guarantors | ||||
Schedule of Condensed Consolidating Statement of Comprehensive Income (Loss) | ||||
Net income (loss) | (7.1) | 14.9 | (10.4) | 12.9 |
Other comprehensive income (loss): | ||||
Net foreign currency translation adjustment | 15.8 | 1.8 | 15.7 | (2.2) |
Net change in derivatives | 0 | 0 | 0 | 0 |
Net change in pension and other post-retirement benefits | 0.2 | 0.2 | 0.4 | 0.6 |
Total other comprehensive income (loss) | 16 | 2 | 16.1 | (1.6) |
Comprehensive income (loss) | 8.9 | 16.9 | 5.7 | 11.3 |
Eliminations/ Consolidations | ||||
Schedule of Condensed Consolidating Statement of Comprehensive Income (Loss) | ||||
Net income (loss) | (155.4) | (182.5) | (153) | (123.1) |
Other comprehensive income (loss): | ||||
Net foreign currency translation adjustment | (15.8) | (1.8) | (15.7) | 2.2 |
Net change in derivatives | 1.1 | 0.2 | 0.7 | (0.8) |
Net change in pension and other post-retirement benefits | (0.3) | (0.5) | (0.6) | (0.9) |
Total other comprehensive income (loss) | (15) | (2.1) | (15.6) | 0.5 |
Comprehensive income (loss) | $ (170.4) | $ (184.6) | $ (168.6) | $ (122.6) |
FINANCIAL INFORMATION FOR SUB80
FINANCIAL INFORMATION FOR SUBSIDIARY GUARANTORS AND NON-GUARANTORS - Condensed Consolidating Statement of Cash Flows (Details) - USD ($) $ in Millions | 3 Months Ended | 6 Months Ended | |||||
Apr. 01, 2017 | Mar. 31, 2018 | Apr. 01, 2017 | Mar. 31, 2018 | Sep. 30, 2017 | Apr. 01, 2017 | Dec. 15, 2016 | |
Schedule of Condensed Consolidating Statement of Cash Flows [Line Items] | |||||||
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES | $ (482.8) | $ (489) | |||||
INVESTING ACTIVITIES | |||||||
Proceeds from sale of long-lived assets | 0.2 | 4.8 | |||||
Post-closing working capital payment related to sale of International Business | (35.3) | 0 | |||||
Investments in property, plant and equipment | (33.1) | (32.8) | |||||
Investments in loans receivable | (7.7) | 0 | |||||
Net (investments in) distributions from unconsolidated affiliates | 0 | (0.2) | |||||
Investments in acquired businesses, net of cash acquired | (144.2) | (77.9) | |||||
Investing cash flows from (to) affiliates | 0 | 0 | |||||
Net cash provided by (used in) investing activities | (220.1) | (106.1) | |||||
FINANCING ACTIVITIES | |||||||
Borrowings under revolving and bank lines of credit and term loans | 1,172.6 | 944.6 | |||||
Repayments under revolving and bank lines of credit and term loans | (243.4) | (395) | |||||
Proceeds from issuance of 5.250% Senior Notes | 0 | 250 | |||||
Financing and issuance fees | 0 | (3.9) | |||||
Dividends paid | (60.3) | (59.9) | |||||
Distribution paid by Aerogrow to noncontrolling interest | 0 | (8.1) | |||||
Purchase of Common Shares | (256.8) | (99.2) | |||||
Payments on seller notes | (3) | (13.2) | |||||
Excess tax benefits from share-based payment arrangements | $ 3.2 | 0 | 4 | ||||
Cash received from the exercise of stock options | 3.8 | 1.7 | |||||
Financing cash flows from (to) affiliates | 0 | ||||||
Net cash provided by financing activities | 612.9 | 621 | |||||
Effect of exchange rate changes on cash | 2.5 | (1.7) | |||||
Net increase (decrease) in cash and cash equivalents | (87.5) | 24.2 | |||||
Cash and cash equivalents at beginning of period | 120.5 | 28.6 | |||||
Cash and cash equivalents at end of period | 55.4 | 33 | 55.4 | ||||
Cash and cash equivalents at beginning of period excluding cash classified within assets held for sale | 55.4 | 120.5 | 28.6 | $ 33 | $ 120.5 | $ 55.4 | |
Cash and cash equivalents at beginning of period classified within assets held for sale | 0 | 21.5 | |||||
Cash and cash equivalents at beginning of period | 120.5 | 50.1 | |||||
Cash and cash equivalents at end of period | 74.3 | 33 | 74.3 | ||||
Return of investment from affiliates | 0 | 0 | |||||
Senior Notes | Senior Notes – 5.250% | |||||||
FINANCING ACTIVITIES | |||||||
Interest rate of debt | 5.25% | 5.25% | 5.25% | 5.25% | |||
Reportable Legal Entities | Parent | |||||||
Schedule of Condensed Consolidating Statement of Cash Flows [Line Items] | |||||||
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES | 9.5 | (8.2) | |||||
INVESTING ACTIVITIES | |||||||
Proceeds from sale of long-lived assets | 0 | 0 | |||||
Post-closing working capital payment related to sale of International Business | 0 | ||||||
Investments in property, plant and equipment | 0 | 0 | |||||
Investments in loans receivable | 0 | ||||||
Net (investments in) distributions from unconsolidated affiliates | 0 | ||||||
Investments in acquired businesses, net of cash acquired | 0 | 0 | |||||
Investing cash flows from (to) affiliates | (250.2) | (436.1) | |||||
Net cash provided by (used in) investing activities | 303.8 | (84.6) | |||||
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 5.250% Senior Notes | 250 | ||||||
Financing and issuance fees | (3.8) | ||||||
Dividends paid | (60.3) | (59.9) | |||||
Distribution paid by Aerogrow to noncontrolling interest | 0 | ||||||
Purchase of Common Shares | (256.8) | (99.2) | |||||
Payments on seller notes | 0 | 0 | |||||
Excess tax benefits from share-based payment arrangements | 4 | ||||||
Cash received from the exercise of stock options | 3.8 | 1.7 | |||||
Financing cash flows from (to) affiliates | 0 | 0 | |||||
Net cash provided by financing activities | (313.3) | 92.8 | |||||
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 | 0 | ||||
Cash and cash equivalents at beginning of period excluding cash classified within assets held for sale | 0 | 0 | 0 | $ 0 | $ 0 | $ 0 | |
Cash and cash equivalents at beginning of period classified within assets held for sale | 0 | ||||||
Cash and cash equivalents at beginning of period | 0 | ||||||
Cash and cash equivalents at end of period | 0 | 0 | |||||
Return of investment from affiliates | 554 | 351.5 | |||||
Reportable Legal Entities | Subsidiary Guarantors | |||||||
Schedule of Condensed Consolidating Statement of Cash Flows [Line Items] | |||||||
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES | (503.5) | (386.6) | |||||
INVESTING ACTIVITIES | |||||||
Proceeds from sale of long-lived assets | 0.2 | 4.8 | |||||
Post-closing working capital payment related to sale of International Business | (35.3) | ||||||
Investments in property, plant and equipment | (29.8) | (27.8) | |||||
Investments in loans receivable | (7.4) | ||||||
Net (investments in) distributions from unconsolidated affiliates | 0 | ||||||
Investments in acquired businesses, net of cash acquired | (40.5) | (1.5) | |||||
Investing cash flows from (to) affiliates | (70.2) | (276.9) | |||||
Net cash provided by (used in) investing activities | (183) | (269) | |||||
FINANCING ACTIVITIES | |||||||
Borrowings under revolving and bank lines of credit and term loans | 1,032.9 | 806.2 | |||||
Repayments under revolving and bank lines of credit and term loans | (154.8) | (232.3) | |||||
Proceeds from issuance of 5.250% Senior Notes | 0 | ||||||
Financing and issuance fees | (0.1) | ||||||
Dividends paid | (554) | (351.5) | |||||
Distribution paid by Aerogrow to noncontrolling interest | 0 | ||||||
Purchase of Common Shares | 0 | 0 | |||||
Payments on seller notes | 0 | 0 | |||||
Excess tax benefits from share-based payment arrangements | 0 | ||||||
Cash received from the exercise of stock options | 0 | 0 | |||||
Financing cash flows from (to) affiliates | 330.2 | 436.1 | |||||
Net cash provided by financing activities | 654.3 | 658.4 | |||||
Effect of exchange rate changes on cash | 0 | 0 | |||||
Net increase (decrease) in cash and cash equivalents | (32.2) | 2.8 | |||||
Cash and cash equivalents at beginning of period | 39.8 | 2.7 | |||||
Cash and cash equivalents at end of period | 5.5 | 7.6 | 5.5 | ||||
Cash and cash equivalents at beginning of period excluding cash classified within assets held for sale | 5.5 | 39.8 | 2.7 | 7.6 | 39.8 | 5.5 | |
Cash and cash equivalents at beginning of period classified within assets held for sale | 0 | ||||||
Cash and cash equivalents at beginning of period | 2.7 | ||||||
Cash and cash equivalents at end of period | 5.5 | 5.5 | |||||
Return of investment from affiliates | 0 | 32.4 | |||||
Reportable Legal Entities | Non-Guarantors | |||||||
Schedule of Condensed Consolidating Statement of Cash Flows [Line Items] | |||||||
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES | 25.2 | (94.2) | |||||
INVESTING ACTIVITIES | |||||||
Proceeds from sale of long-lived assets | 0 | 0 | |||||
Post-closing working capital payment related to sale of International Business | 0 | ||||||
Investments in property, plant and equipment | (3.3) | (5) | |||||
Investments in loans receivable | (0.3) | ||||||
Net (investments in) distributions from unconsolidated affiliates | (0.2) | ||||||
Investments in acquired businesses, net of cash acquired | (103.7) | (76.4) | |||||
Investing cash flows from (to) affiliates | (80) | 0 | |||||
Net cash provided by (used in) investing activities | (187.3) | (81.6) | |||||
FINANCING ACTIVITIES | |||||||
Borrowings under revolving and bank lines of credit and term loans | 139.7 | 138.4 | |||||
Repayments under revolving and bank lines of credit and term loans | (88.6) | (162.7) | |||||
Proceeds from issuance of 5.250% Senior Notes | 0 | ||||||
Financing and issuance fees | 0 | ||||||
Dividends paid | (14) | 0 | |||||
Distribution paid by Aerogrow to noncontrolling interest | (40.5) | ||||||
Purchase of Common Shares | 0 | 0 | |||||
Payments on seller notes | (3) | (13.2) | |||||
Excess tax benefits from share-based payment arrangements | 0 | ||||||
Cash received from the exercise of stock options | 0 | 0 | |||||
Financing cash flows from (to) affiliates | 70.2 | 276.9 | |||||
Net cash provided by financing activities | 104.3 | 198.9 | |||||
Effect of exchange rate changes on cash | 2.5 | (1.7) | |||||
Net increase (decrease) in cash and cash equivalents | (55.3) | 21.4 | |||||
Cash and cash equivalents at beginning of period | 80.7 | 25.9 | |||||
Cash and cash equivalents at end of period | 49.9 | 25.4 | 49.9 | ||||
Cash and cash equivalents at beginning of period excluding cash classified within assets held for sale | 49.9 | 80.7 | 25.9 | 25.4 | 80.7 | 49.9 | |
Cash and cash equivalents at beginning of period classified within assets held for sale | 21.5 | ||||||
Cash and cash equivalents at beginning of period | 47.4 | ||||||
Cash and cash equivalents at end of period | 68.8 | 68.8 | |||||
Return of investment from affiliates | 0 | 0 | |||||
Eliminations/ Consolidations | |||||||
Schedule of Condensed Consolidating Statement of Cash Flows [Line Items] | |||||||
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES | (14) | 0 | |||||
INVESTING ACTIVITIES | |||||||
Proceeds from sale of long-lived assets | 0 | 0 | |||||
Post-closing working capital payment related to sale of International Business | 0 | ||||||
Investments in property, plant and equipment | 0 | 0 | |||||
Investments in loans receivable | 0 | ||||||
Net (investments in) distributions from unconsolidated affiliates | 0 | ||||||
Investments in acquired businesses, net of cash acquired | 0 | 0 | |||||
Investing cash flows from (to) affiliates | 400.4 | 713 | |||||
Net cash provided by (used in) investing activities | (153.6) | 329.1 | |||||
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 5.250% Senior Notes | 0 | ||||||
Financing and issuance fees | 0 | ||||||
Dividends paid | 568 | 351.5 | |||||
Distribution paid by Aerogrow to noncontrolling interest | 32.4 | ||||||
Purchase of Common Shares | 0 | 0 | |||||
Payments on seller notes | 0 | 0 | |||||
Excess tax benefits from share-based payment arrangements | 0 | ||||||
Cash received from the exercise of stock options | 0 | 0 | |||||
Financing cash flows from (to) affiliates | (400.4) | (713) | |||||
Net cash provided by financing activities | 167.6 | (329.1) | |||||
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 | 0 | ||||
Cash and cash equivalents at beginning of period excluding cash classified within assets held for sale | 0 | 0 | 0 | $ 0 | $ 0 | $ 0 | |
Cash and cash equivalents at beginning of period classified within assets held for sale | 0 | ||||||
Cash and cash equivalents at beginning of period | 0 | ||||||
Cash and cash equivalents at end of period | $ 0 | 0 | |||||
Return of investment from affiliates | $ (554) | $ (383.9) |
FINANCIAL INFORMATION FOR SUB81
FINANCIAL INFORMATION FOR SUBSIDIARY GUARANTORS AND NON-GUARANTORS - Condensed Consolidating Balance Sheet (Details) - USD ($) $ in Millions | Mar. 31, 2018 | Sep. 30, 2017 | Apr. 01, 2017 | Sep. 30, 2016 |
Current assets: | ||||
Cash and cash equivalents | $ 33 | $ 120.5 | $ 55.4 | $ 28.6 |
Accounts receivable, net | 598 | 197.7 | 978.3 | |
Accounts receivable pledged | 333.3 | 88.9 | 0 | |
Inventories | 596.9 | 407.5 | 596.5 | |
Assets held for sale | 0 | 0 | 331.5 | |
Prepaid and other current assets | 78.1 | 67.1 | 85.7 | |
Total current assets | 1,639.3 | 881.7 | 2,047.4 | |
Investment in unconsolidated affiliates | 33.2 | 31.1 | 59.9 | |
Property, plant and equipment, net | 463.6 | 467.7 | 437.1 | |
Goodwill | 466.8 | 441.6 | 400.6 | |
Intangible assets, net | 777.6 | 748.9 | 726.8 | |
Other assets | 195 | 176 | 120.2 | |
Equity investment in subsidiaries | 0 | 0 | 0 | |
Intercompany assets | 0 | 0 | 0 | |
Total assets | 3,575.5 | 2,747 | 3,792 | |
Current liabilities: | ||||
Current portion of debt | 335.8 | 143.1 | 32.1 | |
Accounts payable | 253.5 | 153.1 | 270.8 | |
Liabilities held for sale | 0 | 0 | 154.7 | |
Other current liabilities | 316.8 | 248.3 | 318.1 | |
Total current liabilities | 906.1 | 544.5 | 775.7 | |
Long-term debt | 1,937.7 | 1,258 | 2,042.9 | |
Distributions in excess of investment in unconsolidated affiliate | 21.9 | 21.9 | 0 | |
Other liabilities | 213.9 | 260.9 | 282 | |
Equity investment in subsidiaries | 0 | 0 | 0 | |
Intercompany liabilities | 0 | 0 | 0 | |
Total liabilities | 3,079.6 | 2,085.3 | 3,100.6 | |
Total equity—controlling interest | 490.8 | 648.8 | 678.9 | |
Noncontrolling interest | 5.1 | 12.9 | 12.5 | |
Total equity | 495.9 | 661.7 | 691.4 | 734.3 |
Total liabilities and equity | 3,575.5 | 2,747 | 3,792 | |
Reportable Legal Entities | Parent | ||||
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 | 1.7 | 1.3 | 0.7 | |
Total current assets | 1.7 | 1.3 | 0.7 | |
Investment in unconsolidated affiliates | 0 | 0 | 0 | |
Property, plant and equipment, net | 0 | 0 | 0 | |
Goodwill | 0 | 0 | 0 | |
Intangible assets, net | 0 | 0 | 0 | |
Other assets | 8.7 | 8.1 | 10.7 | |
Equity investment in subsidiaries | 1,287.1 | 1,112.8 | 938.7 | |
Intercompany assets | 1,163.1 | 759.7 | 1,778.4 | |
Total assets | 2,460.6 | 1,881.9 | 2,728.5 | |
Current liabilities: | ||||
Current portion of debt | 15 | 15 | 15 | |
Accounts payable | 0 | 0 | 0 | |
Liabilities held for sale | 0 | |||
Other current liabilities | 17.2 | 17.1 | 17.8 | |
Total current liabilities | 32.2 | 32.1 | 32.8 | |
Long-term debt | 1,936.6 | 1,200.7 | 2,016.1 | |
Distributions in excess of investment in unconsolidated affiliate | 0 | 0 | ||
Other liabilities | 1 | 0.3 | 0.7 | |
Equity investment in subsidiaries | 0 | 0 | 0 | |
Intercompany liabilities | 0 | 0 | 0 | |
Total liabilities | 1,969.8 | 1,233.1 | 2,049.6 | |
Total equity—controlling interest | 490.8 | 648.8 | 678.9 | |
Noncontrolling interest | 0 | 0 | 0 | |
Total equity | 490.8 | 648.8 | 678.9 | |
Total liabilities and equity | 2,460.6 | 1,881.9 | 2,728.5 | |
Reportable Legal Entities | Subsidiary Guarantors | ||||
Current assets: | ||||
Cash and cash equivalents | 7.6 | 39.8 | 5.5 | 2.7 |
Accounts receivable, net | 533 | 137.6 | 900.8 | |
Accounts receivable pledged | 333.3 | 88.9 | ||
Inventories | 495.5 | 314 | 500.7 | |
Assets held for sale | 0 | |||
Prepaid and other current assets | 55 | 43.4 | 47.4 | |
Total current assets | 1,424.4 | 623.7 | 1,454.4 | |
Investment in unconsolidated affiliates | 0 | 0 | 59.1 | |
Property, plant and equipment, net | 399.8 | 406.4 | 385.8 | |
Goodwill | 323 | 320.7 | 262.9 | |
Intangible assets, net | 633.9 | 606.3 | 554.2 | |
Other assets | 171.1 | 158.3 | 107.8 | |
Equity investment in subsidiaries | 0 | 0 | 0 | |
Intercompany assets | 304 | 0 | 0 | |
Total assets | 3,256.2 | 2,115.4 | 2,824.2 | |
Current liabilities: | ||||
Current portion of debt | 317.7 | 97.8 | 15.8 | |
Accounts payable | 222.6 | 124.9 | 240.6 | |
Liabilities held for sale | 0 | |||
Other current liabilities | 265.5 | 191.5 | 260.7 | |
Total current liabilities | 805.8 | 414.2 | 517.1 | |
Long-term debt | 1,166.8 | 508.6 | 1,288.2 | |
Distributions in excess of investment in unconsolidated affiliate | 21.9 | 21.9 | ||
Other liabilities | 148.1 | 197.4 | 224.7 | |
Equity investment in subsidiaries | 69.3 | 82.6 | 31.5 | |
Intercompany liabilities | 0 | 17.1 | 45.3 | |
Total liabilities | 2,211.9 | 1,241.8 | 2,106.8 | |
Total equity—controlling interest | 1,044.3 | 873.6 | 717.4 | |
Noncontrolling interest | 0 | 0 | 0 | |
Total equity | 1,044.3 | 873.6 | 717.4 | |
Total liabilities and equity | 3,256.2 | 2,115.4 | 2,824.2 | |
Reportable Legal Entities | Non-Guarantors | ||||
Current assets: | ||||
Cash and cash equivalents | 25.4 | 80.7 | 49.9 | 25.9 |
Accounts receivable, net | 65 | 60.1 | 77.5 | |
Accounts receivable pledged | 0 | 0 | ||
Inventories | 101.4 | 93.5 | 95.8 | |
Assets held for sale | 331.5 | |||
Prepaid and other current assets | 21.4 | 22.4 | 37.6 | |
Total current assets | 213.2 | 256.7 | 592.3 | |
Investment in unconsolidated affiliates | 33.2 | 31.1 | 0.8 | |
Property, plant and equipment, net | 63.8 | 61.3 | 51.3 | |
Goodwill | 132.2 | 109.3 | 126.1 | |
Intangible assets, net | 135.6 | 133.8 | 163.1 | |
Other assets | 15.2 | 9.6 | 2.1 | |
Equity investment in subsidiaries | 0 | 0 | 0 | |
Intercompany assets | 0 | 0 | 0 | |
Total assets | 593.2 | 601.8 | 935.7 | |
Current liabilities: | ||||
Current portion of debt | 18.1 | 45.3 | 16.3 | |
Accounts payable | 30.9 | 28.2 | 30.2 | |
Liabilities held for sale | 154.7 | |||
Other current liabilities | 34.1 | 39.7 | 39.6 | |
Total current liabilities | 83.1 | 113.2 | 240.8 | |
Long-term debt | 128.8 | 108 | 114 | |
Distributions in excess of investment in unconsolidated affiliate | 0 | 0 | ||
Other liabilities | 59.8 | 58.2 | 51.9 | |
Equity investment in subsidiaries | 0 | 0 | 0 | |
Intercompany liabilities | 134.9 | 152.7 | 326.1 | |
Total liabilities | 406.6 | 432.1 | 732.8 | |
Total equity—controlling interest | 186.6 | 169.7 | 202.9 | |
Noncontrolling interest | 0 | 0 | 0 | |
Total equity | 186.6 | 169.7 | 202.9 | |
Total liabilities and equity | 593.2 | 601.8 | 935.7 | |
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 | 0 | |
Property, plant and equipment, net | 0 | 0 | 0 | |
Goodwill | 11.6 | 11.6 | 11.6 | |
Intangible assets, net | 8.1 | 8.8 | 9.5 | |
Other assets | 0 | (0.4) | ||
Equity investment in subsidiaries | (1,287.1) | (1,112.8) | (938.7) | |
Intercompany assets | (1,467.1) | (759.7) | (1,778.4) | |
Total assets | (2,734.5) | (1,852.1) | (2,696.4) | |
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 | (1,294.5) | (559.3) | (1,375.4) | |
Distributions in excess of investment in unconsolidated affiliate | 0 | 0 | ||
Other liabilities | 5 | 5 | 4.7 | |
Equity investment in subsidiaries | (69.3) | (82.6) | (31.5) | |
Intercompany liabilities | (134.9) | (169.8) | (371.4) | |
Total liabilities | (1,508.7) | (821.7) | (1,788.6) | |
Total equity—controlling interest | (1,230.9) | (1,043.3) | (920.3) | |
Noncontrolling interest | 5.1 | 12.9 | 12.5 | |
Total equity | (1,225.8) | (1,030.4) | (907.8) | |
Total liabilities and equity | $ (2,734.5) | $ (1,852.1) | $ (2,696.4) |