EIGHTH PROSPECTUS SUPPLEMENT DATED MARCH 20, 2000
(to prospectus dated November 11, 1999)
Sunbeam Corporation
$2,014,000,000
Zero Coupon Convertible Senior Subordinated Debentures Due 2018
and
Shares of Common Stock Issuable Upon Conversion of the Debentures
Recent Developments
Fourth Quarter 1999 Results
For the fourth quarter, total company net sales increased to $612
million from $515 million 1998, an increase of 19%. Sunbeam's operating loss
narrowed to $100 million from $278 million the prior year.
As a result of interest expense and amortization related to the 1998
acquisitions, a $21 million tax benefit, and minority interest expense related
to Coleman arising from Sunbeam's less than 100% ownership, Sunbeam reported a
net loss for the quarter of $144 million, or $1.43 per diluted share, compared
with a net loss of $311 million, or $3.09 per diluted share in the 1998 period.
Fourth quarter 1999 net results were negatively impacted by unusual
and largely non-cash charges totaling $93 million related to write-downs of
non-core assets, Y2K remediation and reserve adjustments to non-operating
liabilities.
In comparing the fourth quarter of 1998 and 1999, fourth quarter
1998 results were negatively impacted by prior business practices and by
numerous charges totaling $107 million related largely to write-downs of
inventory and fixed assets, the write-off of goodwill, expenses for work
performed relating to the restatement of Sunbeam's historical financial
statements, Y2K remediation and the extinguishment of debt. Of these total
charges, $97 million were reflected in operating income, with the remaining $10
million reported as extraordinary.
Exclusive of the unusual charges, gross margins increased to 26%
from approxi mately 3% the prior year, operating loss narrowed to $7 million
versus a loss of $181 million in 1998, and EBITDA improved $168 million to $24
million from a loss of $144 million.
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Full Year 1999 Results
For the full year, total company net sales increased to $2.4 billion
from $1.8 billion in 1998. Sunbeam's operating loss narrowed to $97 million from
$670 million for all of 1998. On a pro forma basis, adjusting for the acquired
companies' first quarter 1998 sales which were excluded from Sunbeam's results a
year ago, sales increased by approximately $280 million year over year, or 13%.
As a result of interest expense and amortization related to the 1998
acquisitions, an income tax benefit of $9 million, and minority interest expense
related to Coleman arising from Sunbeam's less than 100% ownership, Sunbeam
reported a full year net loss of $300 million, or $2.97 per diluted share,
compared with a net loss of $898 million, or $9.25 per diluted share for all of
1998.
Net results for 1999 were negatively impacted by unusual and largely
non-cash charges totaling $121 million related to write-downs of non-core
assets, Y2K remediation, and reserve adjustments to non-operating liabilities.
1998 net results were negatively impacted by prior business
practices and by numerous unusual charges to income totaling $476 million
related to write-downs of inventory and fixed assets, the issuance of warrants,
purchase accounting adjustments, compensation of certain members of prior
management, the write-off of goodwill and the early extinguishment of debt.
Exclusive of these charges and adjusted for acquisitions and
divestitures in the first half of 1998, Sunbeam's 1999 gross margins increased
to 26% from 14% the prior year, operating income was $24 million versus a loss
of $329 million in 1998, an improvement of $353 million, and EBITDA improved
$328 million to $152 million from a loss of $176 million. Full year operating
cash flow use improved $186 million to a use of $4 million in 1999, indicative
of improved operating results and Sunbeam's focus on working capital management.
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SUNBEAM CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in thousands, except per share amounts)
Three Months Ended Fiscal Year Ended
--------------------------------- -----------------------------
December 31 December 31, December 31 December 31,
1999 1998 1999 1998
------------ --------------- ------------ --------------
Net sales $ 611,552 $ 514,742 $ 2,397,979 $ 1,836,871
Cost of goods sold 469,877 513,606 1,793,360 1,788,819
Selling, general and
administrative expense 241,267 279,485 701,223 718,077
Operating loss (99,592) (278,349) (96,604) (670,025)
Interest expense 63,550 42,131 200,181 131,091
Other expense (income), net 1,020 (219) (3,599) (4,768)
Loss from continuing
operations before income
taxes, minority interest
and extraordinary charge (164,162) (320,261) (293,186) (796,348)
Income taxes (benefit):
Current (5,598) 4,672 (4,227) 8,667
Deferred (15,887) (17,517) (4,597) (18,797)
(21,485) (12,845) (8,824) (10,130)
Minority interest 1,803 (7,234) 15,157 (10,681)
Loss from continuing
operations before
extraordinary charge (144,480) (300,182) (299,519) (775,737)
Extraordinary charge
from early extinguishments
of debt --- (10,671) --- (122,386)
Net loss $ (144,480) $ (310,853) $ (299,519) $ (897,923)
Loss per share:
Loss from continuing
operations before
extraordinary charge:
Basic $ (1.43) $ (2.98) $ (2.97) $ (7.99)
Diluted $ (1.43) $ (2.98) $ (2.97) $ (7.99)
Extraordinary Charge:
Basic $--- $ (0.11) $--- $ (1.26)
Diluted $--- $ (0.11) $--- $ (1.26)
Net loss:
Basic $ (1.43) $ (3.09) $ (2.97) $ (9.25)
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SUNBEAM CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(Amounts in thousands, except per share amounts)
Three Months Ended Fiscal Year Ended
--------------------------------- -----------------------------
December 31 December 31, December 31 December 31,
1999 1998 1999 1998
------------ --------------- ------------ --------------
Diluted $(1.43) $(3.09) $(2.97) $(9.25)
Weighted average common
shares outstanding:
Basic 100,746 100,725 100,744 97,121
Diluted 100,746 100,725 100,744 97,121
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ADDITIONAL SELLING SECURITYHOLDERS
The following represents an addendum to the table of selling
securityholders appearing in the November 11, 1999 prospectus on pages 131-32.
Principal Amount at Common Stock
Maturity of Debentures Percent of Total Owned Prior to Common Stock
Beneficially Owned and Outstanding Original Debentures to be Registered
Selling Securityholders Offered Hereby Debentures Offering Hereby
- -------------------------- --------------------- ------------------ ------------------- ----------------
WM High Yield Fund $ 4,400,000 - - -
Banque Nationale de Paris 7,000,000 - - -
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