Cover page
Cover page - shares | 3 Months Ended | |
May 31, 2021 | Jul. 01, 2021 | |
Entity Addresses [Line Items] | ||
Document Type | 10-Q | |
Document Quarterly Report | true | |
Document Period End Date | May 31, 2021 | |
Document Transition Report | false | |
Entity File Number | 001-14669 | |
Entity Registrant Name | HELEN OF TROY LIMITED | |
Entity Incorporation, State or Country Code | D0 | |
Entity Tax Identification Number | 74-2692550 | |
Entity Address, Address Line One | 1 Helen of Troy Plaza | |
Entity Address, City or Town | El Paso | |
Entity Address, State or Province | TX | |
Entity Address, Postal Zip Code | 79912 | |
City Area Code | 915 | |
Local Phone Number | 225-8000 | |
Title of 12(b) Security | Common Shares, $0.10 par value per share | |
Trading Symbol | HELE | |
Security Exchange Name | NASDAQ | |
Entity Current Reporting Status | Yes | |
Entity Interactive Data Current | Yes | |
Entity Filer Category | Large Accelerated Filer | |
Entity Small Business | false | |
Entity Emerging Growth Company | false | |
Entity Shell Company | false | |
Entity Common Stock, Shares Outstanding | 24,098,751 | |
Entity Central Index Key | 0000916789 | |
Current Fiscal Year End Date | --02-28 | |
Document Fiscal Year Focus | 2022 | |
Document Fiscal Period Focus | Q1 | |
Amendment Flag | false | |
Other Address | ||
Entity Addresses [Line Items] | ||
Entity Address, Address Line One | Clarendon House, 2 Church Street | |
Entity Address, City or Town | Hamilton | |
Entity Address, Country | BM |
Consolidated Condensed Balance
Consolidated Condensed Balance Sheets (Unaudited) - USD ($) $ in Thousands | May 31, 2021 | Feb. 28, 2021 |
Assets, current: | ||
Cash and cash equivalents | $ 37,368 | $ 45,120 |
Receivables - principally trade, less allowances of $594 and $998 | 406,409 | 382,449 |
Inventory | 540,129 | 481,611 |
Prepaid expenses and other current assets | 18,584 | 16,170 |
Income taxes receivable | 4,938 | 6,720 |
Assets held for sale | 48,646 | 39,867 |
Total assets, current | 1,056,074 | 971,937 |
Property and equipment, net of accumulated depreciation of $145,915 and $140,379 | 134,450 | 136,535 |
Goodwill | 739,901 | 739,901 |
Other intangible assets, net of accumulated amortization of $154,224 and $151,240 | 354,642 | 357,264 |
Operating lease assets | 31,905 | 32,533 |
Deferred tax assets, net | 26,431 | 21,748 |
Other assets | 4,689 | 3,570 |
Total assets | 2,348,092 | 2,263,488 |
Liabilities, current: | ||
Accounts payable, principally trade | 317,573 | 334,807 |
Accrued expenses and other current liabilities | 232,604 | 271,179 |
Income taxes payable | 13,917 | 7,022 |
Long-term debt, current maturities | 1,884 | 1,884 |
Liabilities held for sale | 5,757 | 0 |
Total liabilities, current | 571,735 | 614,892 |
Long-term debt, excluding current maturities | 509,090 | 341,746 |
Lease liabilities, non-current | 37,788 | 38,352 |
Deferred tax liabilities, net | 6,432 | 5,735 |
Other liabilities, non-current | 20,966 | 23,416 |
Total liabilities | 1,146,011 | 1,024,141 |
Commitments and contingencies | ||
Stockholders' equity: | ||
Cumulative preferred stock, non-voting, $1.00 par. Authorized 2,000,000 shares; none issued | 0 | 0 |
Common stock, $0.10 par. Authorized 50,000,000 shares; 24,097,766 and 24,405,921 shares issued and outstanding | 2,410 | 2,441 |
Additional paid in capital | 283,394 | 283,396 |
Accumulated other comprehensive loss | (12,453) | (11,656) |
Retained earnings | 928,730 | 965,166 |
Total stockholders' equity | 1,202,081 | 1,239,347 |
Total liabilities and stockholders' equity | $ 2,348,092 | $ 2,263,488 |
Consolidated Condensed Balanc_2
Consolidated Condensed Balance Sheets (Parenthetical) - USD ($) $ in Thousands | May 31, 2021 | Feb. 28, 2021 |
Statement of Financial Position [Abstract] | ||
Allowance on receivables | $ 594 | $ 998 |
Property and equipment, accumulated depreciation | 145,915 | 140,379 |
Other intangible assets, accumulated amortization | $ 154,224 | $ 151,240 |
Preferred Stock, Par or Stated Value Per Share | $ 1 | $ 1 |
Cumulative preferred stock, non-voting, authorized shares (in shares) | 2,000,000 | 2,000,000 |
Cumulative preferred stock, non-voting, issued shares (in shares) | 0 | 0 |
Common Stock, Par or Stated Value Per Share | $ 0.10 | $ 0.10 |
Common stock, authorized shares (in shares) | 50,000,000 | 50,000,000 |
Common stock, shares issued (in shares) | 24,097,766 | 24,405,921 |
Common stock, shares outstanding (in shares) | 24,097,766 | 24,405,921 |
Consolidated Condensed Statemen
Consolidated Condensed Statements of Income (Unaudited) - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | |
May 31, 2021 | May 31, 2020 | |
Income Statement [Abstract] | ||
Sales revenue, net | $ 541,223 | $ 420,835 |
Cost of goods sold | 320,631 | 241,534 |
Gross profit | 220,592 | 179,301 |
Selling, general and administrative expense (“SG&A”) | 155,751 | 121,989 |
Restructuring charges | 6 | 333 |
Operating income | 64,835 | 56,979 |
Non-operating income, net | 102 | 236 |
Interest expense | 2,995 | 3,846 |
Income before income tax | 61,942 | 53,369 |
Income tax expense (benefit) | 4,970 | (6,917) |
Net income | $ 56,972 | $ 60,286 |
Earnings per share (“EPS”): | ||
Basic (in dollars per share) | $ 2.34 | $ 2.39 |
Diluted (in dollars per share) | $ 2.31 | $ 2.37 |
Weighted average shares used in computing EPS: | ||
Basic (in shares) | 24,349 | 25,254 |
Diluted (in shares) | 24,636 | 25,397 |
Consolidated Condensed Statem_2
Consolidated Condensed Statements of Comprehensive Income (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
May 31, 2021 | May 31, 2020 | |
Statement of Comprehensive Income [Abstract] | ||
Net income | $ 56,972 | $ 60,286 |
Other comprehensive loss, net of tax: | ||
Cash flow hedge activity - interest rate swaps | 757 | (2,607) |
Cash flow hedge activity - foreign currency contracts | (1,554) | 695 |
Total other comprehensive loss, net of tax | (797) | (1,912) |
Comprehensive income | $ 56,175 | $ 58,374 |
Condensed Consolidated Statemen
Condensed Consolidated Statements of Stockholders' Equity - USD ($) shares in Thousands, $ in Thousands | Total | Common Stock | Additional Paid in Capital | Accumulated Other Comprehensive Loss | Retained Earnings |
Beginning balance (in shares) at Feb. 29, 2020 | 25,194 | ||||
Beginning balance at Feb. 29, 2020 | $ 1,161,723 | $ 2,519 | $ 268,043 | $ (7,005) | $ 898,166 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 60,286 | 60,286 | |||
Other comprehensive income (loss), net of tax | (1,912) | (1,912) | |||
Exercise of stock options (in shares) | 8 | ||||
Exercise of stock options | 476 | $ 1 | 475 | ||
Net issuance and settlement of restricted stock (in shares) | 165 | ||||
Issuance and settlement of restricted stock | 0 | $ 17 | (17) | ||
Issuance of common stock related to stock purchase plan (in shares) | 15 | ||||
Issuance of common stock related to stock purchase plan | 1,901 | $ 1 | 1,900 | ||
Common stock repurchased and retired (in shares) | (61) | ||||
Common stock repurchased and retired | (10,013) | $ (6) | (9,895) | (112) | |
Share-based compensation | 9,291 | 9,291 | |||
Ending balance (in shares) at May. 31, 2020 | 25,321 | ||||
Ending balance at May. 31, 2020 | 1,221,752 | $ 2,532 | 269,797 | (8,917) | 958,340 |
Beginning balance (in shares) at Feb. 28, 2021 | 24,406 | ||||
Beginning balance at Feb. 28, 2021 | 1,239,347 | $ 2,441 | 283,396 | (11,656) | 965,166 |
Increase (Decrease) in Stockholders' Equity [Roll Forward] | |||||
Net income | 56,972 | 56,972 | |||
Other comprehensive income (loss), net of tax | (797) | (797) | |||
Exercise of stock options (in shares) | 4 | ||||
Exercise of stock options | 275 | 275 | |||
Net issuance and settlement of restricted stock (in shares) | 177 | ||||
Issuance and settlement of restricted stock | 0 | $ 18 | (18) | ||
Issuance of common stock related to stock purchase plan (in shares) | 13 | ||||
Issuance of common stock related to stock purchase plan | 2,338 | $ 1 | 2,337 | ||
Common stock repurchased and retired (in shares) | (502) | ||||
Common stock repurchased and retired | (110,074) | $ (50) | (16,616) | (93,408) | |
Share-based compensation | 14,020 | 14,020 | |||
Ending balance (in shares) at May. 31, 2021 | 24,098 | ||||
Ending balance at May. 31, 2021 | $ 1,202,081 | $ 2,410 | $ 283,394 | $ (12,453) | $ 928,730 |
Consolidated Condensed Statem_3
Consolidated Condensed Statements of Cash Flows (Unaudited) - USD ($) $ in Thousands | 3 Months Ended | |
May 31, 2021 | May 31, 2020 | |
Cash provided by operating activities: | ||
Net income | $ 56,972 | $ 60,286 |
Adjustments to reconcile net income to net cash (used) provided by operating activities: | ||
Depreciation and amortization | 8,713 | 9,140 |
Amortization of financing costs | 243 | 267 |
Non-cash operating lease expense | 2,027 | 1,558 |
Provision for credit losses | 0 | 1,738 |
Non-cash share-based compensation | 14,020 | 9,291 |
Loss on the sale or disposal of property and equipment | 0 | 6 |
Deferred income taxes and tax credits | (3,811) | 2,274 |
Changes in operating capital: | ||
Receivables | (38,747) | 13,516 |
Inventory | (58,860) | (16,017) |
Prepaid expenses and other current assets | (2,414) | 1,490 |
Other assets and liabilities, net | (3,185) | (3,907) |
Accounts payable | (10,885) | 40,963 |
Accrued expenses and other current liabilities | (35,574) | (16,010) |
Accrued income taxes | 8,116 | (11,769) |
Net cash (used) provided by operating activities | (63,385) | 92,826 |
Cash used by investing activities: | ||
Capital and intangible asset expenditures | (4,006) | (6,451) |
Net cash used by investing activities | (4,006) | (6,451) |
Cash provided (used) by financing activities: | ||
Proceeds from line of credit | 221,100 | 765,200 |
Repayment of line of credit | (52,100) | (774,200) |
Repayment of long-term debt | (1,900) | (1,900) |
Payment of financing costs | 0 | (3,789) |
Proceeds from share issuances under share-based compensation plans | 2,613 | 2,377 |
Payments for repurchases of common stock | (110,074) | (10,013) |
Net cash provided (used) by financing activities | 59,639 | (22,325) |
Net (decrease) increase in cash and cash equivalents | (7,752) | 64,050 |
Cash and cash equivalents, beginning balance | 45,120 | 24,467 |
Cash and cash equivalents, ending balance | $ 37,368 | $ 88,517 |
Basis of Presentation and Relat
Basis of Presentation and Related Information | 3 Months Ended |
May 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation and Related Information | Note 1 - Basis of Presentation and Related Information Corporate Overview The accompanying condensed consolidated financial statements contain all adjustments (consisting of normal recurring adjustments) necessary to present fairly our consolidated financial position as of May 31, 2021 and February 28, 2021, and the results of our consolidated operations for the interim periods presented. We follow the same accounting policies when preparing quarterly financial data as we use for preparing annual data. These statements should be read in conjunction with the consolidated financial statements and the notes included in our latest annual report on Form 10-K for the fiscal year ended February 28, 2021 (“Form 10-K”), and our other reports on file with the Securities and Exchange Commission (the “SEC”). When used in these notes, unless otherwise indicated or the context suggests otherwise, references to “the Company”, “our Company”, “Helen of Troy”, “we”, “us”, or “our” refer to Helen of Troy Limited and its subsidiaries, which are all wholly-owned. We refer to our common shares, par value $0.10 per share, as “common stock.” References to “the FASB” refer to the Financial Accounting Standards Board. References to “GAAP” refer to accounting principles generally accepted in the United States of America (the “U.S.”). References to “ASU” refer to the codification of GAAP in the Accounting Standards Updates issued by the FASB. References to “ASC” refer to the codification of GAAP in the Accounting Standards Codification issued by the FASB. We incorporated as Helen of Troy Corporation in Texas in 1968 and were reorganized as Helen of Troy Limited in Bermuda in 1994. We are a leading consumer products company offering creative products and solutions for our customers through a diversified portfolio of brands. As of May 31, 2021, we operated three segments: Housewares, Health & Home, and Beauty. Our Housewares segment provides a broad range of innovative consumer products for the home and on the go to help with food preparation, cooking, cleaning, organization, beverage service, and other tasks to ease everyday living for families. The Health & Home segment provides healthcare and home environment products including health care devices, water filtration systems, and small home appliances. Our Beauty segment provides mass and prestige market beauty appliance and personal care products including hair styling appliances, grooming tools, decorative haircare accessories, and liquid-, solid- and powder-based personal care and grooming products. Our business is seasonal due to different calendar events, holidays and seasonal weather patterns. Our fiscal reporting period ends on the last day in February. Historically, our highest sales volume and operating income occur in our third fiscal quarter ending November 30th. We purchase our products from unaffiliated manufacturers, most of which are located in China, Mexico and the U.S. During the fourth quarter of fiscal 2020, we committed to a plan to divest certain assets within our Beauty segment's mass channel personal care business (“Personal Care”). The net assets to be disposed of include intangible assets, inventory, certain net trade receivables, fixed assets and certain accrued sales discounts and allowances relating to our mass channel liquids, powder and aerosol products under brands such as Pert, Brut, Sure and Infusium. Accordingly, we have classified the identified net assets of the disposal group as held for sale. The Personal Care divestiture was completed during the second quarter of fiscal 2022. See Notes 3 and 16 for additional information. In March 2020, the World Health Organization declared the outbreak of a novel coronavirus (“COVID-19”) to be a pandemic. The effects of the COVID-19 pandemic have had an unfavorable impact on certain parts of our business. The impact includes the effect of temporary closures of certain customer stores or limited hours of operation, and materially lower store traffic, primarily during fiscal 2021. Additionally, COVID-19 has disrupted certain parts of our supply chain. Surges in demand and shifts in shopping patterns related to COVID-19, as well as other factors, have strained the global freight network, which is resulting in higher costs, less capacity, and longer lead times. These factors may impact our ability to fulfill some orders on a timely basis. Additionally, the extent of COVID-19's impact on the demand for certain of our product lines in the future will depend on future developments, including the duration, spread and intensity of the pandemic, our continued ability to source and distribute our products, as well as any future government actions affecting consumers and the global economy generally, all of which are uncertain and difficult to predict considering the rapidly evolving landscape. Accordingly, our liquidity and financial results could be impacted in ways that we are not able to predict today. Principles of Consolidation The accompanying condensed consolidated financial statements are prepared in accordance with GAAP and include all of our subsidiaries. Our condensed consolidated financial statements are prepared in U.S. Dollars. All intercompany balances and transactions are eliminated in consolidation. The preparation of consolidated financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the amounts reported in our condensed consolidated financial statements and accompanying notes. Actual results may differ materially from those estimates. Reclassifications We have reclassified, combined or separately disclosed certain amounts in the prior years’ condensed consolidated financial statements and accompanying footnotes to conform with the current period’s presentation. |
New Accounting Pronouncements
New Accounting Pronouncements | 3 Months Ended |
May 31, 2021 | |
Accounting Changes and Error Corrections [Abstract] | |
New Accounting Pronouncements | Note 2 - New Accounting Pronouncements There have been no changes in the information provided in our Form 10-K. |
Assets and Liabilities Held for
Assets and Liabilities Held for Sale | 3 Months Ended |
May 31, 2021 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Assets and Liabilities Held for Sale | Note 3 - Assets and Liabilities Held for Sale During the fourth quarter of fiscal 2020, we committed to a plan to divest certain assets within our Personal Care business and accordingly, we classified the identified net assets of the disposal group as held for sale. The net assets to be disposed of include intangible assets, inventory, certain net trade receivables, fixed assets and certain accrued sales discounts and allowances relating to our mass channel liquids, powder and aerosol products under brands such as Pert, Brut, Sure and Infusium. The Personal Care divestiture was completed during the second quarter of fiscal 2022. See Note 16 for additional information. The carrying amounts of the major classes of assets and liabilities for our Personal Care business that were classified as held for sale are as follows: (in thousands) May 31, 2021 February 28, 2021 Receivables, net of allowance of $89 and $30 $ 16,415 $ 7,979 Inventory 13,010 12,667 Property and equipment, net of accumulated depreciation of $403 100 100 Goodwill, net of accumulated impairment of $80,445 1,397 1,397 Other intangible assets, net of accumulated amortization of $4,474 17,724 17,724 Assets held for sale $ 48,646 $ 39,867 Accrued sales discounts and allowances $ 5,757 $ — Liabilities held for sale $ 5,757 $ — |
Accrued Expenses and Other Curr
Accrued Expenses and Other Current Liabilities | 3 Months Ended |
May 31, 2021 | |
Balance Sheet Related Disclosures [Abstract] | |
Accrued Expenses and Other Current Liabilities | Note 4 - Accrued Expenses and Other Current Liabilities A summary of accrued expenses and other current liabilities is as follows: (in thousands) May 31, 2021 February 28, 2021 Accrued compensation, benefits and payroll taxes $ 26,089 $ 66,385 Accrued sales discounts and allowances 57,758 59,426 Accrued sales returns 30,344 29,434 Accrued advertising 45,528 50,923 Other 72,885 65,011 Total accrued expenses and other current liabilities $ 232,604 $ 271,179 |
Share-Based Compensation Plans
Share-Based Compensation Plans | 3 Months Ended |
May 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Share-Based Compensation Plans | Note 5 - Share-Based Compensation Plans As part of our compensation structure, we grant share-based compensation awards to certain employees and non-employee members of our Board of Directors during the fiscal year. These awards may be subject to attainment of certain service conditions, performance conditions and/or market conditions. During the first quarter of fiscal 2022, we granted 83,227 service condition awards (“Service Condition Awards”) with a weighted average grant date fair value of $219.02. Additionally we granted 143,340 performance-based awards during the first quarter of fiscal 2022, of which 71,670 contained performance conditions (“Performance Condition Awards”) and 71,670 contained market conditions (“Market Condition Awards”) with weighted average grant date fair values of $216.20 and $156.08, respectively. Refer to our Form 10-K for further information on the Company's share-based compensation plans. We recorded share-based compensation expense in SG&A as follows: Three Months Ended May 31, (in thousands) 2021 2020 Stock options $ — $ 12 Directors stock compensation 160 182 Service Condition Awards 1,940 1,920 Performance Condition Awards 10,023 6,691 Market Condition Awards 1,129 — Employee stock purchase plan 768 486 Share-based compensation expense 14,020 9,291 Less income tax benefits (859) (606) Share-based compensation expense, net of tax $ 13,161 $ 8,685 Unrecognized Share-Based Compensation Expense As of May 31, 2021, our total unrecognized share-based compensation for all awards was $47.4 million, which will be recognized over a weighted average amortization period of 2.5 years. The total unrecognized share-based compensation reflects an estimate of target achievement for Performance Condition Awards granted during the first quarter of fiscal 2022 and fiscal 2021, and an estimate of 200% of target achievement for Performance Condition Awards granted in fiscal 2020. |
Repurchases of Common Stock
Repurchases of Common Stock | 3 Months Ended |
May 31, 2021 | |
Equity [Abstract] | |
Repurchase of Common Stock | Note 6 - Repurchases of Common Stock In May 2019, our Board of Directors authorized the repurchase of up to $400 million of our outstanding common stock. The authorization is effective until May 2022 and replaced our former repurchase authorization. As of May 31, 2021, our repurchase authorization allowed for the purchase of $79.6 million of common stock. Our current equity-based compensation plans include provisions that allow for the “net exercise” of share-settled awards by all plan participants. In a net exercise, any required payroll taxes, federal withholding taxes and exercise price of the shares due from the equity holder can be settled by having the holder tender back to us a number of shares at fair value equal to the amounts due. Net exercises are treated as purchases and retirements of shares. The following table summarizes our share repurchase activity for the periods shown: Three Months Ended May 31, (in thousands, except share and per share data) 2021 2020 Common stock repurchased on the open market: Number of shares 436,842 — Aggregate value of shares $ 95,484 $ — Average price per share $ 218.58 $ — Common stock received in connection with share-based compensation: Number of shares 65,644 60,845 Aggregate value of shares $ 14,590 $ 10,013 Average price per share $ 222.26 $ 164.56 |
Restructuring Plan
Restructuring Plan | 3 Months Ended |
May 31, 2021 | |
Restructuring and Related Activities [Abstract] | |
Restructuring Plan | Note 7 - Restructuring Plan In October 2017, we announced a restructuring plan (referred to as “Project Refuel”) intended to enhance performance primarily in the Beauty and former Nutritional Supplements segments. Project Refuel includes charges for a reduction-in-force and the elimination of certain contracts. During the first quarter of fiscal 2019, we expanded Project Refuel to include the realignment and streamlining of our supply chain structure. We are targeting total annualized profit improvements of approximately $10.5 million to $12.5 million over the duration of the plan. We estimate the plan to be completed during fiscal 2022 and expect to incur total restructuring charges of approximately $10.3 million over the duration of the plan, of which $9.2 million have been incurred through the first quarter of fiscal 2022. Restructuring provisions are determined based on estimates prepared at the time the restructuring actions are approved by management and are revised periodically. We incurred an insignificant amount and $0.3 million of pre-tax restructuring costs during the three months ended May 31, 2021 and May 31, 2020, respectively, which are recorded as “Restructuring |
Commitments and Contingencies
Commitments and Contingencies | 3 Months Ended |
May 31, 2021 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 8 - Commitments and Contingencies Legal Matters We are involved in various legal claims and proceedings in the normal course of operations. We believe the outcome of these matters will not have a material adverse effect on our consolidated financial position, results of operations or liquidity, except as described below. Regulatory Matters As a global company, we are subject to U.S. and foreign regulations, including environmental, health and safety laws, and industry-specific product certifications. Many of the products we sell are subject to product safety laws and regulations in various jurisdictions. These laws and regulations specify the maximum allowable levels of certain materials that may be contained in our products, provide statutory prohibitions against misbranded and adulterated products, establish ingredients and manufacturing procedures for certain products, specify product safety testing requirements, and set product identification, labeling and claim requirements. Additionally, some of our product lines within our Health & Home segment are subject to product identification, labeling and claim requirements, which are monitored and enforced by regulatory agencies, such as the U.S. Environmental Protection Agency (the “EPA”), U.S. Customs and Border Protection, the U.S. Food and Drug Administration, and the U.S. Consumer Product Safety Commission. We are currently in discussions with the EPA regarding the compliance of packaging claims on certain of our products in the air and water filtration categories and a limited subset of humidifier products within the Health & Home segment that are sold in the U.S. The EPA has not raised any product quality, safety or performance issues. We expect these products to be available for distribution with the only changes being modified labeling or different packaging. As a result of these discussions, on May 27, 2021, we voluntarily implemented a temporary stop shipment action across this line of products in the U.S. while we ensure that all labeling is in compliance and we work with the EPA towards an expedient resolution. The EPA has approved modest changes to our labeling claims on our existing water filtration packaging, which we have begun to implement. We resumed shipment of these products and are actively working towards similar agreements regarding our air filtration and humidification packaging in continued collaboration with the EPA. At our request, the EPA issued a Stop Sale, Use or Removal Order on June 29, 2021, which, among other things, allows for the movement of certain of our products among our warehouses and will facilitate rework of the affected air filtration packaging once agreed to with the EPA. We believe this is meaningful progress towards a final resolution with the EPA. The stop shipment will remain in effect until we implement an approved labeling and repackaging plan. We expect that our consolidated and Health & Home segment’s fiscal 2022 net sales revenue, gross profit and operating income will be materially and adversely impacted by the stop shipment. At this time, we are not aware of any fines or penalties related to this matter imposed against us by the EPA. While we do not anticipate material fines or penalties, there can be no assurances that such fines or penalties will not be imposed. In addition, during the first quarter of fiscal 2022, we recorded a $13.1 million charge to write-off the obsolete packaging for the affected products in our inventory on-hand and in-transit as of the end of the first quarter of fiscal 2022. The charge was recognized in cost of goods sold and is referred to throughout this Form 10-Q as “EPA compliance costs.” We expect to incur additional compliance costs, which may include costs to relabel or repackage our existing inventory as well as incremental freight and storage costs, among other things. Costs to relabel or repackage our existing inventory will be capitalized into |
Long-Term Debt
Long-Term Debt | 3 Months Ended |
May 31, 2021 | |
Debt Disclosure [Abstract] | |
Long-Term Debt | Note 9 - Long-Term Debt A summary of our long-term debt follows: (in thousands) May 31, 2021 February 28, 2021 Mississippi Business Finance Corporation Loan (the “MBFC Loan”) (1) $ 16,708 $ 18,607 Credit Agreement (2) 498,000 329,000 Subtotal 514,708 347,607 Unamortized prepaid financing fees (3,734) (3,977) Total long-term debt 510,974 343,630 Less: current maturities of long-term debt (1,884) (1,884) Long-term debt, excluding current maturities $ 509,090 $ 341,746 (1) The MBFC Loan is unsecured and bears floating interest based on either the London Interbank Offered Rate (“LIBOR”) plus a margin of up to 2.0%, or a Base Rate plus a margin of up to 1.0%, as determined by the interest rate elected and the Net Leverage Ratio defined in the Indenture. The weighted average interest rate on borrowings outstanding was 1.1% at both May 31, 2021 and February 28, 2021. (2) The Credit Agreement (defined below) is unsecured and bears floating interest at either the Base Rate or LIBOR, plus a margin based on the Net Leverage Ratio (as defined in the Credit Agreement) of 0% to 1.0% and 1.0% to 2.0% for Base Rate and LIBOR borrowings, respectively. These floating interest rates are hedged with interest rate swaps to effectively fix interest rates on $225 million of the outstanding principal balance under the Credit Agreement (see Notes 10, 11, and 12 for additional information regarding interest rate swaps). The weighted average interest rate on borrowings outstanding was 1.1% at both May 31, 2021 and February 28, 2021. Credit Agreement We have a credit agreement (the "Credit Agreement") with Bank of America, N.A., as administrative agent, and other lenders that provides for an unsecured total revolving commitment of $1.25 billion. As of May 31, 2021, the balance of outstanding letters of credit was $19.2 million and the amount available for borrowings was $732.8 million. Covenants in the Credit Agreement limit the amount of total indebtedness we can incur. As of May 31, 2021, these covenants did not limit our ability to incur $732.8 million of additional debt under the Credit Agreement. Debt Covenants As of May 31, 2021, we were in compliance with all covenants as defined under the terms of the Credit Agreement and our other debt agreements. |
Fair Value
Fair Value | 3 Months Ended |
May 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Fair Value | Note 10 - Fair Value Fair value is defined as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Valuation techniques under the accounting guidance related to fair value measurements are based on observable and unobservable inputs. These inputs are classified into the following hierarchy: Level 1: Quoted prices for identical assets or liabilities in active markets; Level 2: Observable inputs other than quoted prices that are directly or indirectly observable for the asset or liability, including quoted prices for similar assets or liabilities in active markets; quoted prices for similar or identical assets or liabilities in markets that are not active; and model-derived valuations whose inputs are observable or whose significant value drivers are observable; and Level 3: Unobservable inputs that reflect the reporting entity’s own assumptions. Our financial assets and liabilities are classified as Level 2 because their valuation is dependent on observable inputs and other quoted prices for similar assets or liabilities, or model-derived valuations whose significant value drivers are observable. The following tables present the carrying amount and fair value of our financial assets and liabilities measured and recorded at fair value on a recurring basis and classified as Level 2 as follows: Carrying Amount and Fair Value (in thousands) May 31, 2021 February 28, 2021 Assets: Cash equivalents (money market accounts) $ 1,602 $ 1,631 Foreign currency derivatives — 33 Total assets $ 1,602 $ 1,664 Liabilities: Interest rate swaps $ 8,947 $ 9,941 Foreign currency derivatives 8,612 6,550 Total liabilities $ 17,559 $ 16,491 The carrying amounts of cash, accounts payable, accrued expenses and other current liabilities and income taxes payable approximate fair value because of the short maturity of these items. The carrying amounts of receivables approximate fair value due to the effect of the related allowance for credit losses. The carrying amount of our floating rate debt approximates its fair value. We use derivatives to manage our exposure to changes in foreign currency exchange rates, which can include foreign currency forward contracts, zero cost collars and cross-currency debt swaps. In addition, we use interest rate swaps to manage our exposure to changes in interest rates. All of our derivative assets and liabilities are recorded at fair value. See Notes 11 and 12 for more information on our derivatives. |
Financial Instruments and Risk
Financial Instruments and Risk Management | 3 Months Ended |
May 31, 2021 | |
Financial Instruments, Owned, at Fair Value [Abstract] | |
Financial Instruments and Risk Management | Note 11 - Financial Instruments and Risk Management Foreign Currency Risk The U.S. Dollar is the functional currency for the Company and all of its subsidiaries and is also the reporting currency for the Company. By operating internationally, we are subject to foreign currency risk from transactions denominated in currencies other than the U.S. Dollar (“foreign currencies”). Such transactions include sales, certain inventory purchases and operating expenses. As a result of such transactions, portions of our cash, trade accounts receivable and trade accounts payable are denominated in foreign currencies. Approximately 12% and 15% of our net sales revenue was denominated in foreign currencies during the three month periods ended May 31, 2021 and 2020, respectively. These sales were primarily denominated in British Pounds, Euros, Mexican Pesos and Canadian Dollars. We make most of our inventory purchases from vendors in the Asia Pacific market and primarily use the U.S. Dollar for such purchases. In our condensed consolidated statements of income, foreign currency exchange rate gains and losses resulting from the remeasurement of foreign taxes receivable, taxes payable, deferred tax assets, and deferred tax liabilities are recognized in their respective income tax lines, and all other foreign currency exchange rate gains and losses are recognized in SG&A. During the three month period ended May 31, 2021, we recorded foreign currency exchange rate net gains of $0.4 million in SG&A compared to foreign currency exchange rate net losses of $1.7 million for the same period last year. We mitigate certain foreign currency exchange rate risk by using a series of foreign currency contracts, which can include forward contracts and zero-cost collars, designated as cash flow hedges, and mark-to-market cross-currency debt swaps to protect against the foreign currency exchange rate risk inherent in our forecasted transactions denominated in foreign currencies. We do not enter into any derivatives or similar instruments for trading or other speculative purposes. Our foreign currency contracts are designated as cash flow hedges and are recorded on the balance sheet at fair value with changes in fair value recorded in Other Comprehensive Loss (“OCI”) until the hedge transaction is settled, at which point amounts are reclassified from Accumulated Other Comprehensive Loss (“AOCI”) to our condensed consolidated statements of income. Derivatives for which we have not elected hedge accounting consist of our cross-currency debt swaps, and any changes in the fair value of the derivatives are recorded in our condensed consolidated statements of income. We evaluate our derivatives designated as cash flow hedges each quarter to assess hedge effectiveness. Any ineffectiveness, which is not material for any year presented, is immediately recognized in our condensed consolidated statements of income. Interest Rate Risk Interest on our outstanding debt as of May 31, 2021 is based on floating interest rates. If short-term interest rates increase, we will incur higher interest expense on any future outstanding balances of floating rate debt. Floating interest rates are hedged with interest rate swaps to effectively fix interest rates on $225.0 million of the outstanding principal balance under the Credit Agreement, which totaled $498.0 million as of May 31, 2021. Our interest rate swaps are designated as cash flow hedges and are recorded on the balance sheet at fair value with changes in fair value recorded in OCI until the hedge transaction is settled, at which point amounts are reclassified from AOCI to our condensed consolidated statements of income. We evaluate our derivatives designated as cash flow hedges each quarter to assess hedge effectiveness. Any ineffectiveness, which is not material for any year presented, is immediately recognized in our condensed consolidated statements of income. The following tables summarize the fair values of our derivative instruments as of the end of the periods presented: (in thousands) May 31, 2021 Derivatives designated as hedging instruments Hedge Final Notional Amount Prepaid Other Assets Accrued Other Forward contracts - sell Euro Cash flow 2/2023 € 43,750 — — 1,867 241 Forward contracts - sell Canadian Dollars Cash flow 2/2023 $ 46,750 — — 1,857 251 Forward contracts - sell Pounds Cash flow 2/2023 £ 38,800 — — 2,399 274 Forward contracts - Sell Australian Dollars Cash flow 11/2021 A$ 4,000 — — 20 — Interest rate swaps Cash flow 1/2024 $ 225,000 — — 4,011 4,936 Subtotal — — 10,154 5,702 Derivatives not designated under hedge accounting Cross-currency debt swaps - Euro (1) 04/2022 € 6,000 — — 863 — Cross-currency debt swaps - Pounds (1) 04/2022 £ 4,500 — — 840 — Subtotal — — 1,703 — Total fair value $ — $ — $ 11,857 $ 5,702 (in thousands) February 28, 2021 Derivatives designated as hedging instruments Hedge Type Final Notional Amount Prepaid Other Assets Accrued Other Forward contracts - sell Euro Cash flow 2/2022 € 39,000 — — 1,851 — Forward contracts - sell Canadian Dollars Cash flow 2/2023 $ 34,000 — 33 1,061 — Forward contracts - sell Pounds Cash flow 2/2023 £ 34,500 — — 2,026 21 Forward contracts - sell Australian Dollars Cash flow 11/2021 A$ 4,000 — — 18 — Interest rate swaps Cash flow 1/2024 $ 225,000 — — 4,407 5,534 Subtotal — 33 9,363 5,555 Derivatives not designated under hedge accounting Cross-currency debt swaps - Euro (1) 04/2022 € 6,000 — — — 817 Cross-currency debt swaps - Pounds (1) 04/2022 £ 4,500 — — — 756 Subtotal — — — 1,573 Total fair value $ — $ 33 $ 9,363 $ 7,128 (1) These cross-currency debt swaps, for which we have not elected hedge accounting, adjust the currency denomination of a portion of our outstanding debt to the Euro and British Pound, as applicable, for the notional amounts reported, creating an economic hedge against currency movements. The pre-tax effects of derivative instruments designated as cash flow hedges were as follows for the periods presented: Three Months Ended May 31, Gain (Loss) Gain (Loss) Reclassified (in thousands) 2021 Location 2021 Foreign currency contracts - cash flow hedges $ (3,191) Sales revenue, net $ (1,226) Interest rate swaps - cash flow hedges (290) Interest expense (1,284) Total $ (3,481) $ (2,510) Three Months Ended May 31, Gain (Loss) Gain (Loss) Reclassified (in thousands) 2020 Location 2020 Foreign currency contracts - cash flow hedges $ 1,604 SG&A $ 765 Interest rate swaps - cash flow hedges (4,133) Interest expense (726) Total $ (2,529) $ 39 The pre-tax effects of derivative instruments not designated under hedge accounting were as follows for the periods presented: Three Months Ended May 31, Gain (Loss) (in thousands) Location 2021 2020 Cross-currency debt swaps - principal SG&A (129) (149) Cross-currency debt swaps - interest Interest expense (2) 74 Total $ (131) $ (75) We expect a net loss of $10.2 million associated with foreign currency contracts and interest rate swaps currently reported in AOCI to be reclassified into income over the next twelve months. The amount ultimately realized, however, will differ as exchange rates and interest rates change and the underlying contracts settle. See Notes 10 and 12 to these condensed consolidated financial statements for more information. Counterparty Credit Risk Financial instruments, including foreign currency contracts, cross-currency debt swaps and interest rate swaps, expose us to counterparty credit risk for non-performance. We manage our exposure to counterparty credit risk by only dealing with counterparties who are substantial international financial institutions with significant experience using such derivative instruments. We believe that the risk of incurring credit losses is remote. |
Accumulated Other Comprehensive
Accumulated Other Comprehensive Income (Loss) | 3 Months Ended |
May 31, 2021 | |
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent [Abstract] | |
Accumulated Other Comprehensive Income (Loss) | Note 12 - Accumulated Other Comprehensive Income (Loss) The changes in AOCI by component and related tax effects for the periods presented were as follows: (in thousands) Interest Foreign Total Balance at February 29, 2020 $ (8,199) $ 1,194 $ (7,005) Other comprehensive (loss) income before reclassification (4,133) 1,604 (2,529) Amounts reclassified out of AOCI 726 (765) (39) Tax effects 800 (144) 656 Other comprehensive (loss) income (2,607) 695 (1,912) Balance at May 31, 2020 $ (10,806) $ 1,889 $ (8,917) Balance at February 28, 2021 $ (7,576) $ (4,080) $ (11,656) Other comprehensive loss before reclassification (290) (3,191) (3,481) Amounts reclassified out of AOCI 1,284 1,226 2,510 Tax effects (237) 411 174 Other comprehensive income (loss) 757 (1,554) (797) Balance at May 31, 2021 $ (6,819) $ (5,634) $ (12,453) See Notes 9, 10 and 11 to these condensed consolidated financial statements for additional information regarding our cash flow hedges. |
Segment Information
Segment Information | 3 Months Ended |
May 31, 2021 | |
Segment Reporting [Abstract] | |
Segment Information | Note 13 - Segment Information The following tables summarize segment information for the periods presented: Three Months Ended May 31, 2021 (in thousands) Housewares Health & Home Beauty Total Sales revenue, net $ 193,644 $ 204,096 $ 143,483 $ 541,223 Restructuring charges — — 6 6 Operating income 27,143 11,249 26,443 64,835 Capital and intangible asset expenditures 2,987 748 271 4,006 Depreciation and amortization 2,548 2,726 3,439 8,713 Three Months Ended May 31, 2020 (in thousands) Housewares Health & Home Beauty Total Sales revenue, net $ 140,628 $ 199,956 $ 80,251 $ 420,835 Restructuring charges 238 — 95 333 Operating income 23,233 31,533 2,213 56,979 Capital and intangible asset expenditures 2,717 3,408 326 6,451 Depreciation and amortization 2,122 4,052 2,966 9,140 |
Income Taxes
Income Taxes | 3 Months Ended |
May 31, 2021 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 14 - Income Taxes We reorganized the Company in Bermuda in 1994 and many of our foreign subsidiaries are not directly or indirectly owned by a U.S. parent. As such, a large portion of our foreign income is not subject to U.S. taxation on a permanent basis under current law. Additionally, our intellectual property is largely owned by foreign subsidiaries, resulting in proportionally higher earnings in jurisdictions with lower statutory tax rates, which decreases our overall effective tax rate. The taxable income earned in each jurisdiction, whether U.S. or foreign, is determined by the subsidiary's operating results and transfer pricing and tax regulations in the related jurisdictions. For interim periods, our income tax expense and resulting effective tax rate are based upon an estimated annual effective tax rate adjusted for the effects of items required to be treated as discrete to the period, including changes in tax laws, changes in estimated exposures for uncertain tax positions and other items. On March 11, 2021, the American Rescue Plan Act (the “ARM”) was enacted and signed into law. The ARM is an economic stimulus package in response to the COVID-19 outbreak which contains tax provisions that did not have a material impact to our condensed consolidated financial statements. On March 27, 2020, the Coronavirus Aid, Relief and Economic Security Act (the “CARES Act”) was enacted and signed into law. The CARES Act is an emergency economic stimulus package in response to the COVID-19 outbreak that contains numerous tax provisions. Among other things, the CARES Act included technical corrections to the effective date language in the Tax Cuts and Jobs Act, enacted into law on December 22, 2017 (the “Tax Act”), related to net operating loss carrybacks. Upon the enactment of the Tax Act in fiscal 2018, there was a net operating loss on our balance sheet, which was measured using the U.S. statutory tax rate in effect prior to enactment. As a result of the Tax Act, we were required to record a one-time charge of $17.9 million in fiscal 2018, which included a charge of $9.4 million to remeasure the net operating loss at the reduced rate at which it was expected to reverse in the future. The CARES Act effectively reversed the impact of the Tax Act on our net operating loss, resulting in a corresponding tax benefit of $9.4 million recorded in the first quarter of fiscal 2021. For the three months ended May 31, 2021, income tax expense as a percentage of income before income tax was 8.0% compared to an income tax benefit of 13.0% for the same period last year, primarily due to the benefit of the CARES Act in fiscal 2021. Income tax expense for the three months ended May 31, 2021 is driven by the mix of taxable income in our various tax jurisdictions and excess tax benefits associated with share-based compensation recognized in the period in which it is settled. Our Macau subsidiary generates income from the sale of the goods that it has sourced and procured. This subsidiary is responsible for the sourcing and procurement of a large portion of the products that we sell. We previously had an indefinite tax holiday in Macau conditioned on the subsidiary meeting certain employment and investment thresholds. The Macau Offshore Law and its supplementary regulations that grant tax incentives to approved offshore institutions was abolished on January 1, 2021. Existing approved offshore institutions such as ours continued to operate under the offshore regime until the end of the calendar year 2020. Beginning in calendar year 2021, our Macau subsidiary transitioned to onshore status and is now subject to a statutory corporate income tax of 12%. Because our Macau subsidiary is not directly or indirectly owned by a U.S. parent, there is no U.S. tax liability associated with the income generated in Macau. |
Earnings Per Share
Earnings Per Share | 3 Months Ended |
May 31, 2021 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Note 15 - Earnings Per Share We compute basic earnings per share using the weighted average number of shares of common stock outstanding during the period. We compute diluted earnings per share using the weighted average number of shares of common stock outstanding plus the effect of dilutive securities. Dilutive securities at any given point in time may consist of outstanding options to purchase common stock and issued and contingently issuable unvested restricted stock units, performance stock units, restricted stock awards and performance restricted stock awards and other stock based awards. Anti-dilutive securities are not included in the computation of diluted earnings per share under the treasury stock method. See Note 5 to these condensed consolidated financial statements for more information regarding stock-based awards. The following table presents our weighted average basic and diluted shares outstanding for the periods shown: Three Months Ended May 31, (in thousands) 2021 2020 Weighted average shares outstanding, basic 24,349 25,254 Incremental shares from share-based compensation arrangements 287 143 Weighted average shares outstanding, diluted 24,636 25,397 Anti-dilutive securities — 262 |
Subsequent Events
Subsequent Events | 3 Months Ended |
May 31, 2021 | |
Subsequent Events [Abstract] | |
Subsequent Events | Note 16 - Subsequent Events Divestiture of Personal Care Business On June 7, 2021, we completed the sale of our Personal Care business, not including the Latin America and Caribbean regions, to HRB Brands LLC, for $44.7 million in cash. The sale also includes an option that provides HRB Brands LLC the right to purchase the Latin America and Caribbean Personal Care businesses no later than the end of fiscal 2022, subject to meeting certain agreed-upon conditions. The carrying amount of the identified assets and liabilities within the disposal group were classified as held for sale as of May 31, 2021. The transaction is not reflected in our condensed consolidated financial statements as of and for the period ended May 31, 2021. See Note 3 for additional information. |
Basis of Presentation and Rel_2
Basis of Presentation and Related Information (Policies) | 3 Months Ended |
May 31, 2021 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Principles of Consolidation | Principles of Consolidation The accompanying condensed consolidated financial statements are prepared in accordance with GAAP and include all of our subsidiaries. Our condensed consolidated financial statements are prepared in U.S. Dollars. All intercompany balances and transactions are eliminated in consolidation. The preparation of consolidated financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the amounts reported in our condensed consolidated financial statements and accompanying notes. Actual results may differ materially from those estimates. |
Reclassification | Reclassifications We have reclassified, combined or separately disclosed certain amounts in the prior years’ condensed consolidated financial statements and accompanying footnotes to conform with the current period’s presentation. |
Assets and Liabilities Held f_2
Assets and Liabilities Held for Sale (Tables) | 3 Months Ended |
May 31, 2021 | |
Discontinued Operations and Disposal Groups [Abstract] | |
Carrying amounts of major asset classes for Personal Care classified as held-for-sale | The carrying amounts of the major classes of assets and liabilities for our Personal Care business that were classified as held for sale are as follows: (in thousands) May 31, 2021 February 28, 2021 Receivables, net of allowance of $89 and $30 $ 16,415 $ 7,979 Inventory 13,010 12,667 Property and equipment, net of accumulated depreciation of $403 100 100 Goodwill, net of accumulated impairment of $80,445 1,397 1,397 Other intangible assets, net of accumulated amortization of $4,474 17,724 17,724 Assets held for sale $ 48,646 $ 39,867 Accrued sales discounts and allowances $ 5,757 $ — Liabilities held for sale $ 5,757 $ — |
Accrued Expenses and Other Cu_2
Accrued Expenses and Other Current Liabilities (Tables) | 3 Months Ended |
May 31, 2021 | |
Balance Sheet Related Disclosures [Abstract] | |
Schedule of accrued expenses and other current liabilities | A summary of accrued expenses and other current liabilities is as follows: (in thousands) May 31, 2021 February 28, 2021 Accrued compensation, benefits and payroll taxes $ 26,089 $ 66,385 Accrued sales discounts and allowances 57,758 59,426 Accrued sales returns 30,344 29,434 Accrued advertising 45,528 50,923 Other 72,885 65,011 Total accrued expenses and other current liabilities $ 232,604 $ 271,179 |
Share-Based Compensation Plans
Share-Based Compensation Plans (Tables) | 3 Months Ended |
May 31, 2021 | |
Share-based Payment Arrangement [Abstract] | |
Share-based compensation expense in SG&A | We recorded share-based compensation expense in SG&A as follows: Three Months Ended May 31, (in thousands) 2021 2020 Stock options $ — $ 12 Directors stock compensation 160 182 Service Condition Awards 1,940 1,920 Performance Condition Awards 10,023 6,691 Market Condition Awards 1,129 — Employee stock purchase plan 768 486 Share-based compensation expense 14,020 9,291 Less income tax benefits (859) (606) Share-based compensation expense, net of tax $ 13,161 $ 8,685 |
Repurchase of Helen of Troy Com
Repurchase of Helen of Troy Common Stock (Tables) | 3 Months Ended |
May 31, 2021 | |
Equity [Abstract] | |
Summary of share repurchase activity | The following table summarizes our share repurchase activity for the periods shown: Three Months Ended May 31, (in thousands, except share and per share data) 2021 2020 Common stock repurchased on the open market: Number of shares 436,842 — Aggregate value of shares $ 95,484 $ — Average price per share $ 218.58 $ — Common stock received in connection with share-based compensation: Number of shares 65,644 60,845 Aggregate value of shares $ 14,590 $ 10,013 Average price per share $ 222.26 $ 164.56 |
Long-Term Debt (Tables)
Long-Term Debt (Tables) | 3 Months Ended |
May 31, 2021 | |
Debt Disclosure [Abstract] | |
Summary of long-term debt | A summary of our long-term debt follows: (in thousands) May 31, 2021 February 28, 2021 Mississippi Business Finance Corporation Loan (the “MBFC Loan”) (1) $ 16,708 $ 18,607 Credit Agreement (2) 498,000 329,000 Subtotal 514,708 347,607 Unamortized prepaid financing fees (3,734) (3,977) Total long-term debt 510,974 343,630 Less: current maturities of long-term debt (1,884) (1,884) Long-term debt, excluding current maturities $ 509,090 $ 341,746 (1) The MBFC Loan is unsecured and bears floating interest based on either the London Interbank Offered Rate (“LIBOR”) plus a margin of up to 2.0%, or a Base Rate plus a margin of up to 1.0%, as determined by the interest rate elected and the Net Leverage Ratio defined in the Indenture. The weighted average interest rate on borrowings outstanding was 1.1% at both May 31, 2021 and February 28, 2021. (2) The Credit Agreement (defined below) is unsecured and bears floating interest at either the Base Rate or LIBOR, plus a margin based on the Net Leverage Ratio (as defined in the Credit Agreement) of 0% to 1.0% and 1.0% to 2.0% for Base Rate and LIBOR borrowings, respectively. These floating interest rates are hedged with interest rate swaps to effectively fix interest rates on $225 million of the outstanding principal balance under the Credit Agreement (see Notes 10, 11, and 12 for additional information regarding interest rate swaps). The weighted average interest rate on borrowings outstanding was 1.1% at both May 31, 2021 and February 28, 2021. |
Fair Value (Tables)
Fair Value (Tables) | 3 Months Ended |
May 31, 2021 | |
Fair Value Disclosures [Abstract] | |
Schedule of fair value hierarchy of financial assets and liabilities presented at fair value and measured on a recurring basis | The following tables present the carrying amount and fair value of our financial assets and liabilities measured and recorded at fair value on a recurring basis and classified as Level 2 as follows: Carrying Amount and Fair Value (in thousands) May 31, 2021 February 28, 2021 Assets: Cash equivalents (money market accounts) $ 1,602 $ 1,631 Foreign currency derivatives — 33 Total assets $ 1,602 $ 1,664 Liabilities: Interest rate swaps $ 8,947 $ 9,941 Foreign currency derivatives 8,612 6,550 Total liabilities $ 17,559 $ 16,491 |
Financial Instruments and Ris_2
Financial Instruments and Risk Management (Tables) | 3 Months Ended |
May 31, 2021 | |
Financial Instruments, Owned, at Fair Value [Abstract] | |
Schedule of fair values of derivative instruments | The following tables summarize the fair values of our derivative instruments as of the end of the periods presented: (in thousands) May 31, 2021 Derivatives designated as hedging instruments Hedge Final Notional Amount Prepaid Other Assets Accrued Other Forward contracts - sell Euro Cash flow 2/2023 € 43,750 — — 1,867 241 Forward contracts - sell Canadian Dollars Cash flow 2/2023 $ 46,750 — — 1,857 251 Forward contracts - sell Pounds Cash flow 2/2023 £ 38,800 — — 2,399 274 Forward contracts - Sell Australian Dollars Cash flow 11/2021 A$ 4,000 — — 20 — Interest rate swaps Cash flow 1/2024 $ 225,000 — — 4,011 4,936 Subtotal — — 10,154 5,702 Derivatives not designated under hedge accounting Cross-currency debt swaps - Euro (1) 04/2022 € 6,000 — — 863 — Cross-currency debt swaps - Pounds (1) 04/2022 £ 4,500 — — 840 — Subtotal — — 1,703 — Total fair value $ — $ — $ 11,857 $ 5,702 (in thousands) February 28, 2021 Derivatives designated as hedging instruments Hedge Type Final Notional Amount Prepaid Other Assets Accrued Other Forward contracts - sell Euro Cash flow 2/2022 € 39,000 — — 1,851 — Forward contracts - sell Canadian Dollars Cash flow 2/2023 $ 34,000 — 33 1,061 — Forward contracts - sell Pounds Cash flow 2/2023 £ 34,500 — — 2,026 21 Forward contracts - sell Australian Dollars Cash flow 11/2021 A$ 4,000 — — 18 — Interest rate swaps Cash flow 1/2024 $ 225,000 — — 4,407 5,534 Subtotal — 33 9,363 5,555 Derivatives not designated under hedge accounting Cross-currency debt swaps - Euro (1) 04/2022 € 6,000 — — — 817 Cross-currency debt swaps - Pounds (1) 04/2022 £ 4,500 — — — 756 Subtotal — — — 1,573 Total fair value $ — $ 33 $ 9,363 $ 7,128 (1) These cross-currency debt swaps, for which we have not elected hedge accounting, adjust the currency denomination of a portion of our outstanding debt to the Euro and British Pound, as applicable, for the notional amounts reported, creating an economic hedge against currency movements. |
Schedule of pre-tax effect of derivative instruments designated as hedges | The pre-tax effects of derivative instruments designated as cash flow hedges were as follows for the periods presented: Three Months Ended May 31, Gain (Loss) Gain (Loss) Reclassified (in thousands) 2021 Location 2021 Foreign currency contracts - cash flow hedges $ (3,191) Sales revenue, net $ (1,226) Interest rate swaps - cash flow hedges (290) Interest expense (1,284) Total $ (3,481) $ (2,510) Three Months Ended May 31, Gain (Loss) Gain (Loss) Reclassified (in thousands) 2020 Location 2020 Foreign currency contracts - cash flow hedges $ 1,604 SG&A $ 765 Interest rate swaps - cash flow hedges (4,133) Interest expense (726) Total $ (2,529) $ 39 |
Schedule of pre-tax effect of derivative instruments not designated as hedges | The pre-tax effects of derivative instruments not designated under hedge accounting were as follows for the periods presented: Three Months Ended May 31, Gain (Loss) (in thousands) Location 2021 2020 Cross-currency debt swaps - principal SG&A (129) (149) Cross-currency debt swaps - interest Interest expense (2) 74 Total $ (131) $ (75) |
Accumulated Other Comprehensi_2
Accumulated Other Comprehensive Income (Loss) (Tables) | 3 Months Ended |
May 31, 2021 | |
Other Comprehensive Income (Loss), Net of Tax, Portion Attributable to Parent [Abstract] | |
Summary of changes in accumulated other comprehensive income (loss) | The changes in AOCI by component and related tax effects for the periods presented were as follows: (in thousands) Interest Foreign Total Balance at February 29, 2020 $ (8,199) $ 1,194 $ (7,005) Other comprehensive (loss) income before reclassification (4,133) 1,604 (2,529) Amounts reclassified out of AOCI 726 (765) (39) Tax effects 800 (144) 656 Other comprehensive (loss) income (2,607) 695 (1,912) Balance at May 31, 2020 $ (10,806) $ 1,889 $ (8,917) Balance at February 28, 2021 $ (7,576) $ (4,080) $ (11,656) Other comprehensive loss before reclassification (290) (3,191) (3,481) Amounts reclassified out of AOCI 1,284 1,226 2,510 Tax effects (237) 411 174 Other comprehensive income (loss) 757 (1,554) (797) Balance at May 31, 2021 $ (6,819) $ (5,634) $ (12,453) |
Segment Information (Tables)
Segment Information (Tables) | 3 Months Ended |
May 31, 2021 | |
Segment Reporting [Abstract] | |
Schedule of segment information | The following tables summarize segment information for the periods presented: Three Months Ended May 31, 2021 (in thousands) Housewares Health & Home Beauty Total Sales revenue, net $ 193,644 $ 204,096 $ 143,483 $ 541,223 Restructuring charges — — 6 6 Operating income 27,143 11,249 26,443 64,835 Capital and intangible asset expenditures 2,987 748 271 4,006 Depreciation and amortization 2,548 2,726 3,439 8,713 Three Months Ended May 31, 2020 (in thousands) Housewares Health & Home Beauty Total Sales revenue, net $ 140,628 $ 199,956 $ 80,251 $ 420,835 Restructuring charges 238 — 95 333 Operating income 23,233 31,533 2,213 56,979 Capital and intangible asset expenditures 2,717 3,408 326 6,451 Depreciation and amortization 2,122 4,052 2,966 9,140 |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 3 Months Ended |
May 31, 2021 | |
Earnings Per Share [Abstract] | |
Schedule of components of basic and diluted shares | The following table presents our weighted average basic and diluted shares outstanding for the periods shown: Three Months Ended May 31, (in thousands) 2021 2020 Weighted average shares outstanding, basic 24,349 25,254 Incremental shares from share-based compensation arrangements 287 143 Weighted average shares outstanding, diluted 24,636 25,397 Anti-dilutive securities — 262 |
Basis of Presentation and Rel_3
Basis of Presentation and Related Information (Details) | 3 Months Ended | |
May 31, 2021Segment$ / shares | Feb. 28, 2021$ / shares | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | ||
Common shares, par value (in dollars per share) | $ / shares | $ 0.10 | $ 0.10 |
Number of segments | Segment | 3 |
Assets and Liabilities Held f_3
Assets and Liabilities Held for Sale (Details) - USD ($) $ in Thousands | May 31, 2021 | Feb. 28, 2021 |
Long Lived Assets Held-for-sale [Line Items] | ||
Assets held for sale | $ 48,646 | $ 39,867 |
Liabilities held for sale | 5,757 | 0 |
Allowance on receivables | 594 | 998 |
Property and equipment, accumulated depreciation | 145,915 | 140,379 |
Other intangible assets, accumulated amortization | 154,224 | 151,240 |
Personal Care | ||
Long Lived Assets Held-for-sale [Line Items] | ||
Assets held for sale | 48,646 | 39,867 |
Liabilities held for sale | 5,757 | 0 |
Allowance on receivables | 89 | 30 |
Goodwill accumulated impairment | 80,445 | 80,445 |
Personal Care | Accrued sales discounts and allowances | ||
Long Lived Assets Held-for-sale [Line Items] | ||
Liabilities held for sale | 5,757 | 0 |
Other Intangible Assets, Held-For-Sale | Personal Care | ||
Long Lived Assets Held-for-sale [Line Items] | ||
Other intangible assets, accumulated amortization | 4,474 | 4,474 |
Property, Plant and Equipment, Held-for-Sale | Personal Care | ||
Long Lived Assets Held-for-sale [Line Items] | ||
Property and equipment, accumulated depreciation | 403 | 403 |
Receivables, net of allowance of $89 and $30 | Personal Care | ||
Long Lived Assets Held-for-sale [Line Items] | ||
Assets held for sale | 16,415 | 7,979 |
Inventory | Personal Care | ||
Long Lived Assets Held-for-sale [Line Items] | ||
Assets held for sale | 13,010 | 12,667 |
Property and equipment, net of accumulated depreciation of $403 | Personal Care | ||
Long Lived Assets Held-for-sale [Line Items] | ||
Assets held for sale | 100 | 100 |
Goodwill, net of accumulated impairment of $80,445 | Personal Care | ||
Long Lived Assets Held-for-sale [Line Items] | ||
Assets held for sale | 1,397 | 1,397 |
Other intangible assets, net of accumulated amortization of $4,474 | Personal Care | ||
Long Lived Assets Held-for-sale [Line Items] | ||
Assets held for sale | $ 17,724 | $ 17,724 |
Accrued Expenses and Other Cu_3
Accrued Expenses and Other Current Liabilities (Details) - USD ($) $ in Thousands | May 31, 2021 | Feb. 28, 2021 |
ACCRUED EXPENSES AND OTHER CURRENT LIABILITIES | ||
Accrued compensation, benefits and payroll taxes | $ 26,089 | $ 66,385 |
Accrued sales discounts and allowances | 57,758 | 59,426 |
Accrued sales returns | 30,344 | 29,434 |
Accrued advertising | 45,528 | 50,923 |
Other | 72,885 | 65,011 |
Total accrued expenses and other current liabilities | $ 232,604 | $ 271,179 |
Share-Based Compensation Plan_2
Share-Based Compensation Plans (Details) $ / shares in Units, $ in Thousands | 3 Months Ended |
May 31, 2021USD ($)$ / sharesshares | |
Share-based compensation plans | |
Expected recognition period for unrecognized share-based compensation | 2 years 6 months |
Share Based Compensation Arrangement By Share Based Payment Award, Equity Instruments Other Than Options, Target Achievement, As A Percentage | 200.00% |
Restricted Stock | |
Share-based compensation plans | |
Number of awards granted (in shares) | 143,340 |
Unrecognized share-based compensation | $ | $ 47,400 |
Service Condition Awards | |
Share-based compensation plans | |
Number of awards granted (in shares) | 83,227 |
Grant date fair value of shares granted in period (in dollars per share) | $ / shares | $ 219.02 |
Market Condition Awards | |
Share-based compensation plans | |
Number of awards granted (in shares) | 71,670 |
Grant date fair value of shares granted in period (in dollars per share) | $ / shares | $ 156.08 |
Performance Condition Awards | |
Share-based compensation plans | |
Number of awards granted (in shares) | 71,670 |
Grant date fair value of shares granted in period (in dollars per share) | $ / shares | $ 216.20 |
Share-Based Compensation Plan_3
Share-Based Compensation Plans Share Based Compensation Expense in SG&A (Details) - USD ($) $ in Thousands | 3 Months Ended | |
May 31, 2021 | May 31, 2020 | |
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Share-based compensation expense, net of tax | $ 13,161 | $ 8,685 |
SG&A | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Share-based compensation expense | 14,020 | 9,291 |
Less income tax benefits | (859) | (606) |
Stock options | SG&A | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Share-based compensation expense | 0 | 12 |
Service Condition Awards | SG&A | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Share-based compensation expense | 1,940 | 1,920 |
Performance Condition Awards | SG&A | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Share-based compensation expense | 10,023 | 6,691 |
Market Condition Awards | SG&A | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Share-based compensation expense | 1,129 | 0 |
Employee stock purchase plan | SG&A | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Share-based compensation expense | 768 | 486 |
Directors stock compensation | SG&A | ||
Share-based Compensation Arrangement by Share-based Payment Award, Compensation Cost [Line Items] | ||
Share-based compensation expense | $ 160 | $ 182 |
Repurchase of Common Stock (Det
Repurchase of Common Stock (Details) - USD ($) | May 31, 2021 | May 31, 2019 |
Equity [Abstract] | ||
Amount of shares authorized for purchase | $ 400,000,000 | |
Remaining share repurchase amount | $ 79,600,000 |
Repurchase of Common Stock - Su
Repurchase of Common Stock - Summary of share repurpose activity (Details) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | |
May 31, 2021 | May 31, 2020 | |
Repurchase of common stock | ||
Aggregate value of shares | $ 110,074 | $ 10,013 |
Stock Compensation Plan | ||
Repurchase of common stock | ||
Number of shares (in shares) | 65,644 | 60,845,000 |
Aggregate value of shares | $ 14,590 | $ 10,013 |
Average price per share (in dollars per share) | $ 222.26 | $ 164.56 |
Open Market | ||
Repurchase of common stock | ||
Number of shares (in shares) | 436,842 | 0 |
Aggregate value of shares | $ 95,484 | $ 0 |
Average price per share (in dollars per share) | $ 218.58 | $ 0 |
Restructuring Plan (Details)
Restructuring Plan (Details) - USD ($) $ in Thousands | 3 Months Ended | 41 Months Ended | ||
May 31, 2021 | May 31, 2020 | Feb. 28, 2021 | Feb. 28, 2022 | |
Restructuring Plan | ||||
Restructuring charges | $ 6 | $ 333 | ||
Cash restructuring payments for the reporting period | 100 | |||
Project Refuel | ||||
Restructuring Plan | ||||
Incurred pre-tax restructuring costs | 9,200 | |||
Restructuring charges | 300 | $ 300 | ||
Cash restructuring payments to date | $ 9,200 | |||
Minimum | Project Refuel | ||||
Restructuring Plan | ||||
Targeted annualized profit improvement | $ 10,500 | |||
Maximum | Project Refuel | ||||
Restructuring Plan | ||||
Targeted annualized profit improvement | $ 12,500 | |||
Scenario, Forecast | Project Refuel | ||||
Restructuring Plan | ||||
Expected restructuring costs | $ 10,300 |
Commitments and Contingencies (
Commitments and Contingencies (Details) $ in Millions | 3 Months Ended |
May 31, 2021USD ($) | |
Health & Home | EPA Remediation Costs | |
Commitments and contingencies | |
Charge to write off obsolete packaging | $ 13.1 |
Long-Term Debt - Schedule (Deta
Long-Term Debt - Schedule (Details) - USD ($) $ in Thousands | 3 Months Ended | |
May 31, 2021 | Feb. 28, 2021 | |
Long-term debt | ||
Aggregate principal balance | $ 514,708 | $ 347,607 |
Unamortized prepaid financing fees | (3,734) | (3,977) |
Total long-term debt | 510,974 | 343,630 |
Long-term debt, current maturities | (1,884) | (1,884) |
Long-term debt, excluding current maturities | 509,090 | 341,746 |
MBFC loan | ||
Long-term debt | ||
Aggregate principal balance | $ 16,708 | 18,607 |
Weighted average effective interest rate | 1.10% | |
MBFC loan | Base rate | ||
Long-term debt | ||
Interest rate | 1.00% | |
MBFC loan | LIBOR | ||
Long-term debt | ||
Interest rate | 2.00% | |
Credit agreement | ||
Long-term debt | ||
Aggregate principal balance | $ 498,000 | $ 329,000 |
Weighted average effective interest rate | 1.10% | |
Fixed rate debt | $ 225,000 | |
Credit agreement | Minimum | Base rate | ||
Long-term debt | ||
Interest rate | 0.00% | |
Credit agreement | Minimum | LIBOR | ||
Long-term debt | ||
Interest rate | 1.00% | |
Credit agreement | Maximum | Base rate | ||
Long-term debt | ||
Interest rate | 1.00% | |
Credit agreement | Maximum | LIBOR | ||
Long-term debt | ||
Interest rate | 2.00% | |
Unsecured Senior Notes3.90 Percent Due Jan2018 | ||
Long-term debt | ||
Fixed rate debt | $ 225,000 |
Long-Term Debt (Details)
Long-Term Debt (Details) $ in Millions | May 31, 2021USD ($) |
Debt Instrument [Line Items] | |
Maximum additional debt allowed under debt covenants | $ 732.8 |
Revolving loan | |
Debt Instrument [Line Items] | |
Maximum revolving commitment | 1,250 |
Credit agreement | Letter of credit | |
Debt Instrument [Line Items] | |
Amount outstanding, letters of credit | 19.2 |
MBFC loan | |
Debt Instrument [Line Items] | |
Amount available for borrowings | $ 732.8 |
Fair Value (Details)
Fair Value (Details) - Recurring - Fair Values - Fair Value, Inputs, Level 2 - USD ($) $ in Thousands | May 31, 2021 | Feb. 28, 2021 |
Assets: | ||
Total assets | $ 1,602 | $ 1,664 |
Liabilities: | ||
Total liabilities | 17,559 | 16,491 |
Interest rate swap | ||
Liabilities: | ||
Derivative liabilities | 8,947 | 9,941 |
Foreign currency contracts | ||
Assets: | ||
Foreign currency derivatives | 0 | 33 |
Liabilities: | ||
Derivative liabilities | 8,612 | 6,550 |
Money market accounts | ||
Assets: | ||
Cash equivalents (money market accounts) | $ 1,602 | $ 1,631 |
Financial Instruments and Ris_3
Financial Instruments and Risk Management (Details) - USD ($) $ in Thousands | 3 Months Ended | ||
May 31, 2021 | May 31, 2020 | Feb. 28, 2021 | |
Foreign Currency Risk and Currency Exchange Uncertainties | |||
Aggregate principal balance | $ 514,708 | $ 347,607 | |
Credit agreement | |||
Foreign Currency Risk and Currency Exchange Uncertainties | |||
Fixed rate debt | 225,000 | ||
Aggregate principal balance | 498,000 | $ 329,000 | |
SG&A | |||
Foreign Currency Risk and Currency Exchange Uncertainties | |||
Net foreign exchange gains (losses), including the impact of currency hedges and currency swaps | $ 400 | $ (1,700) | |
Net sales revenue | Geographic concentration | International operations - transactions denominated in foreign currencies | |||
Foreign Currency Risk and Currency Exchange Uncertainties | |||
Concentration risk percentage | 12.00% | 15.00% |
Financial Instruments and Ris_4
Financial Instruments and Risk Management - Interest Rate Risk (Details) $ in Millions | May 31, 2021USD ($) |
Credit agreement | |
Financial instruments and risk management | |
Fixed rate debt | $ 225 |
Financial Instruments and Ris_5
Financial Instruments and Risk Management - Derivative FV (Details) € in Thousands, £ in Thousands, $ in Thousands, $ in Thousands, $ in Thousands | May 31, 2021EUR (€) | May 31, 2021USD ($) | May 31, 2021CAD ($) | May 31, 2021GBP (£) | May 31, 2021AUD ($) | Feb. 28, 2021EUR (€) | Feb. 28, 2021USD ($) | Feb. 28, 2021CAD ($) | Feb. 28, 2021GBP (£) | Feb. 28, 2021AUD ($) |
Prepaid expenses and other current assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | $ 0 | $ 0 | ||||||||
Other assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 0 | 33 | ||||||||
Accrued expenses and other current liabilities | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 11,857 | 9,363 | ||||||||
Other liabilities, non-current | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 5,702 | 7,128 | ||||||||
Derivatives designated as hedging instruments | Prepaid expenses and other current assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 0 | 0 | ||||||||
Derivatives designated as hedging instruments | Other assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 0 | 33 | ||||||||
Derivatives designated as hedging instruments | Accrued expenses and other current liabilities | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 10,154 | 9,363 | ||||||||
Derivatives designated as hedging instruments | Other liabilities, non-current | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 5,702 | 5,555 | ||||||||
Derivatives designated as hedging instruments | Foreign currency contracts | Sell | Euros | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Notional amount | € | € 43,750 | € 39,000 | ||||||||
Derivatives designated as hedging instruments | Foreign currency contracts | Sell | Euros | Prepaid expenses and other current assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 0 | 0 | ||||||||
Derivatives designated as hedging instruments | Foreign currency contracts | Sell | Euros | Other assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 0 | 0 | ||||||||
Derivatives designated as hedging instruments | Foreign currency contracts | Sell | Euros | Accrued expenses and other current liabilities | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 1,867 | 1,851 | ||||||||
Derivatives designated as hedging instruments | Foreign currency contracts | Sell | Euros | Other liabilities, non-current | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 241 | 0 | ||||||||
Derivatives designated as hedging instruments | Foreign currency contracts | Sell | Canadian Dollars | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Notional amount | $ 46,750 | $ 34,000 | ||||||||
Derivatives designated as hedging instruments | Foreign currency contracts | Sell | Canadian Dollars | Prepaid expenses and other current assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 0 | 0 | ||||||||
Derivatives designated as hedging instruments | Foreign currency contracts | Sell | Canadian Dollars | Other assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 0 | 33 | ||||||||
Derivatives designated as hedging instruments | Foreign currency contracts | Sell | Canadian Dollars | Accrued expenses and other current liabilities | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 1,857 | 1,061 | ||||||||
Derivatives designated as hedging instruments | Foreign currency contracts | Sell | Canadian Dollars | Other liabilities, non-current | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 251 | 0 | ||||||||
Derivatives designated as hedging instruments | Foreign currency contracts | Sell | Pounds | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Notional amount | £ | £ 34,500 | |||||||||
Derivatives designated as hedging instruments | Foreign currency contracts | Sell | Pounds | Prepaid expenses and other current assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 0 | |||||||||
Derivatives designated as hedging instruments | Foreign currency contracts | Sell | Pounds | Other assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 0 | |||||||||
Derivatives designated as hedging instruments | Foreign currency contracts | Sell | Pounds | Accrued expenses and other current liabilities | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 2,026 | |||||||||
Derivatives designated as hedging instruments | Foreign currency contracts | Sell | Pounds | Other liabilities, non-current | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 21 | |||||||||
Derivatives designated as hedging instruments | Foreign currency contracts | Sell | Australian Dollars | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Notional amount | $ 4,000 | $ 4,000 | ||||||||
Derivatives designated as hedging instruments | Foreign currency contracts | Sell | Australian Dollars | Prepaid expenses and other current assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 0 | 0 | ||||||||
Derivatives designated as hedging instruments | Foreign currency contracts | Sell | Australian Dollars | Other assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 0 | 0 | ||||||||
Derivatives designated as hedging instruments | Foreign currency contracts | Sell | Australian Dollars | Accrued expenses and other current liabilities | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 20 | 18 | ||||||||
Derivatives designated as hedging instruments | Foreign currency contracts | Sell | Australian Dollars | Other liabilities, non-current | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 0 | 0 | ||||||||
Derivatives designated as hedging instruments | Zero-cost collar contract | Sell | Pounds | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Notional amount | £ | £ 38,800 | |||||||||
Derivatives designated as hedging instruments | Zero-cost collar contract | Sell | Pounds | Prepaid expenses and other current assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 0 | |||||||||
Derivatives designated as hedging instruments | Zero-cost collar contract | Sell | Pounds | Other assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 0 | |||||||||
Derivatives designated as hedging instruments | Zero-cost collar contract | Sell | Pounds | Accrued expenses and other current liabilities | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 2,399 | |||||||||
Derivatives designated as hedging instruments | Zero-cost collar contract | Sell | Pounds | Other liabilities, non-current | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 274 | |||||||||
Derivatives designated as hedging instruments | Interest rate swaps | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Notional amount | 225,000 | 225,000 | ||||||||
Derivatives designated as hedging instruments | Interest rate swaps | Prepaid expenses and other current assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 0 | 0 | ||||||||
Derivatives designated as hedging instruments | Interest rate swaps | Other assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 0 | 0 | ||||||||
Derivatives designated as hedging instruments | Interest rate swaps | Accrued expenses and other current liabilities | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 4,011 | 4,407 | ||||||||
Derivatives designated as hedging instruments | Interest rate swaps | Other liabilities, non-current | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 4,936 | 5,534 | ||||||||
Derivatives not designated under hedge accounting | Prepaid expenses and other current assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 0 | 0 | ||||||||
Derivatives not designated under hedge accounting | Other assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 0 | 0 | ||||||||
Derivatives not designated under hedge accounting | Accrued expenses and other current liabilities | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 1,703 | 0 | ||||||||
Derivatives not designated under hedge accounting | Other liabilities, non-current | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 0 | 1,573 | ||||||||
Derivatives not designated under hedge accounting | Cross currency debt swaps | Euros | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Notional amount | € | € 6,000 | € 6,000 | ||||||||
Derivatives not designated under hedge accounting | Cross currency debt swaps | Euros | Prepaid expenses and other current assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 0 | 0 | ||||||||
Derivatives not designated under hedge accounting | Cross currency debt swaps | Euros | Other assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 0 | 0 | ||||||||
Derivatives not designated under hedge accounting | Cross currency debt swaps | Euros | Accrued expenses and other current liabilities | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 863 | 0 | ||||||||
Derivatives not designated under hedge accounting | Cross currency debt swaps | Euros | Other liabilities, non-current | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 0 | 817 | ||||||||
Derivatives not designated under hedge accounting | Cross currency debt swaps | Pounds | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Notional amount | £ | £ 4,500 | £ 4,500 | ||||||||
Derivatives not designated under hedge accounting | Cross currency debt swaps | Pounds | Prepaid expenses and other current assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 0 | 0 | ||||||||
Derivatives not designated under hedge accounting | Cross currency debt swaps | Pounds | Other assets | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative assets | 0 | 0 | ||||||||
Derivatives not designated under hedge accounting | Cross currency debt swaps | Pounds | Accrued expenses and other current liabilities | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | 840 | 0 | ||||||||
Derivatives not designated under hedge accounting | Cross currency debt swaps | Pounds | Other liabilities, non-current | ||||||||||
Fair values of derivative instruments in the consolidated balance sheet | ||||||||||
Derivative liabilities | $ 0 | $ 756 |
Financial Instruments and Ris_6
Financial Instruments and Risk Management - Derivative tax effect (Details) - USD ($) $ in Thousands | 3 Months Ended | |
May 31, 2021 | May 31, 2020 | |
Pre-tax effect of derivative instruments | ||
Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), before Reclassification and Tax | $ (3,481) | $ (2,529) |
Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), Reclassification, after Tax | (2,510) | 39 |
Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), after Reclassification, before Tax | (131) | (75) |
Foreign currency contracts | Cash flow hedges | ||
Pre-tax effect of derivative instruments | ||
Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), before Reclassification and Tax | (3,191) | 1,604 |
Net loss currently reported in accumulated other comprehensive income, to be reclassified into income | $ 10,200 | |
Net loss currently reported in accumulated other comprehensive income, to be reclassified into income, period of time to transfer | 12 months | |
Foreign currency contracts | Cash flow hedges | SG&A | ||
Pre-tax effect of derivative instruments | ||
Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), Reclassification, after Tax | $ (1,226) | 765 |
Interest rate swaps | Cash flow hedges | ||
Pre-tax effect of derivative instruments | ||
Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), before Reclassification and Tax | (290) | (4,133) |
Interest rate swaps | Cash flow hedges | Interest expense | ||
Pre-tax effect of derivative instruments | ||
Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), Reclassification, after Tax | (1,284) | (726) |
Cross currency debt swaps | SG&A | ||
Pre-tax effect of derivative instruments | ||
Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), after Reclassification, before Tax | (129) | (149) |
Cross currency debt swaps | Interest expense | ||
Pre-tax effect of derivative instruments | ||
Other Comprehensive Income (Loss), Cash Flow Hedge, Gain (Loss), after Reclassification, before Tax | $ (2) | $ 74 |
Accumulated Other Comprehensi_3
Accumulated Other Comprehensive Loss (Details) - USD ($) $ in Thousands | 3 Months Ended | |
May 31, 2021 | May 31, 2020 | |
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||
Beginning balance | $ 1,239,347 | $ 1,161,723 |
Other comprehensive loss before reclassification | (3,481) | (2,529) |
Amounts reclassified out of AOCI | 2,510 | (39) |
Tax effects | 174 | 656 |
Total other comprehensive loss, net of tax | (797) | (1,912) |
Ending balance | 1,202,081 | 1,221,752 |
Interest Rate Swaps | ||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||
Beginning balance | (7,576) | (8,199) |
Other comprehensive loss before reclassification | (290) | (4,133) |
Amounts reclassified out of AOCI | 1,284 | 726 |
Tax effects | (237) | 800 |
Total other comprehensive loss, net of tax | 757 | (2,607) |
Ending balance | (6,819) | (10,806) |
Foreign Currency Contracts | ||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||
Beginning balance | (4,080) | 1,194 |
Other comprehensive loss before reclassification | (3,191) | 1,604 |
Amounts reclassified out of AOCI | 1,226 | (765) |
Tax effects | 411 | (144) |
Total other comprehensive loss, net of tax | (1,554) | 695 |
Ending balance | (5,634) | 1,889 |
Total | ||
AOCI Including Portion Attributable to Noncontrolling Interest, Net of Tax [Roll Forward] | ||
Beginning balance | (11,656) | (7,005) |
Total other comprehensive loss, net of tax | (797) | (1,912) |
Ending balance | $ (12,453) | $ (8,917) |
Segment Information (Details)
Segment Information (Details) - USD ($) $ in Thousands | 3 Months Ended | |
May 31, 2021 | May 31, 2020 | |
Segment information | ||
Sales revenue, net | $ 541,223 | $ 420,835 |
Restructuring charges | 6 | 333 |
Operating income | 64,835 | 56,979 |
Capital and intangible asset expenditures | 4,006 | 6,451 |
Depreciation and amortization | 8,713 | 9,140 |
Housewares | ||
Segment information | ||
Sales revenue, net | 193,644 | 140,628 |
Restructuring charges | 0 | 238 |
Operating income | 27,143 | 23,233 |
Capital and intangible asset expenditures | 2,987 | 2,717 |
Depreciation and amortization | 2,548 | 2,122 |
Health & Home | ||
Segment information | ||
Sales revenue, net | 204,096 | 199,956 |
Restructuring charges | 0 | 0 |
Operating income | 11,249 | 31,533 |
Capital and intangible asset expenditures | 748 | 3,408 |
Depreciation and amortization | 2,726 | 4,052 |
Beauty | ||
Segment information | ||
Sales revenue, net | 143,483 | 80,251 |
Restructuring charges | 6 | 95 |
Operating income | 26,443 | 2,213 |
Capital and intangible asset expenditures | 271 | 326 |
Depreciation and amortization | $ 3,439 | $ 2,966 |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 3 Months Ended | 12 Months Ended | |
May 31, 2021 | May 31, 2020 | Feb. 28, 2018 | |
Income Tax Contingency [Line Items] | |||
One time tax charge required due to Tax Act | $ 17,900,000 | ||
Income tax expense (benefit) | $ 4,970,000 | $ (6,917,000) | $ 9,400,000 |
Income tax expense (benefit) as a percent of income before income taxes | 8.00% | (13.00%) | |
U S tax liability for income generated in Macau | $ 0 | ||
COVID-19 | |||
Income Tax Contingency [Line Items] | |||
One-time income tax benefit, CARES Act | $ 9,400,000 |
Earnings per Share (Details)
Earnings per Share (Details) - shares shares in Thousands | 3 Months Ended | |
May 31, 2021 | May 31, 2020 | |
Weighted average diluted securities | ||
Weighted average shares outstanding, basic (in shares) | 24,349 | 25,254 |
Incremental shares from share-based payment arrangements (in shares) | 287 | 143 |
Weighted average shares outstanding, diluted (in shares) | 24,636 | 25,397 |
Stock options | ||
Weighted average diluted securities | ||
Antidilutive securities (in shares) | 0 | 262 |
Subsequent Events (Details)
Subsequent Events (Details) $ in Millions | Jun. 07, 2021USD ($) |
Subsequent Event | Personal Care | |
Subsequent Event [Line Items] | |
Sale of personal care business | $ 44.7 |