Release:
|
IMMEDIATE RELEASE
|
Contact:
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Bruce Byots
Vice President – Corporate and Investor Relations
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Phone:
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847-735-4612
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Contact:
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Daniel Kubera
Director – Media Relations and Corporate Communications
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Phone:
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847-735-4617
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Email:
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daniel.kubera@brunswick.com
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·
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Net sales of $815.4 million, up 22 percent versus third quarter 2009.
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·
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Net loss of $7.2 million, or $0.08 per diluted share, which includes $0.14 per diluted share of restructuring, exit and impairment charges.
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·
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Operating earnings of $25.2 million, a $134.6 million improvement from third quarter 2009.
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·
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Cash totaled $676.5 million, up from 2009 year-end balance of $526.6 million.
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·
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Increased production and wholesale shipments versus prior year levels, resulting from low beginning-of-year marine dealer inventories.
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Brunswick Corporation
|
||||||||||||
Comparative Consolidated Statements of Operations
|
||||||||||||
(in millions, except per share data)
|
||||||||||||
(unaudited)
|
||||||||||||
Three Months Ended
|
||||||||||||
October 2,
|
October 3,
|
|||||||||||
2010
|
2009
|
% Change
|
||||||||||
Net sales
|
$ | 815.4 | $ | 665.8 | 22% | |||||||
Cost of sales
|
632.1 | 590.2 | 7% | |||||||||
Selling, general and administrative expense
|
122.8 | 136.7 | -10% | |||||||||
Research and development expense
|
23.1 | 19.5 | 18% | |||||||||
Restructuring, exit and impairment charges
|
12.2 | 28.8 | -58% | |||||||||
Operating earnings (loss)
|
25.2 | (109.4 | ) |
NM
|
||||||||
Equity loss
|
(2.0 | ) | (3.8 | ) | 47% | |||||||
Other income (expense), net
|
(2.2 | ) | 0.3 |
NM
|
||||||||
Earnings (loss) before interest, loss on early extinguishment of debt
|
21.0 | (112.9 | ) |
NM
|
||||||||
and income taxes
|
||||||||||||
Interest expense
|
(22.7 | ) | (23.6 | ) | 4% | |||||||
Interest income
|
0.9 | 0.7 | 29% | |||||||||
Loss on early extinguishment of debt
|
(1.1 | ) | (0.1 | ) |
NM
|
|||||||
Loss before income taxes
|
(1.9 | ) | (135.9 | ) | 99% | |||||||
Income tax provision (benefit)
|
5.3 | (21.6 | ) | |||||||||
Net loss
|
$ | (7.2 | ) | $ | (114.3 | ) | 94% | |||||
Loss per common share:
|
||||||||||||
Basic
|
$ | (0.08 | ) | $ | (1.29 | ) | ||||||
Diluted
|
$ | (0.08 | ) | $ | (1.29 | ) | ||||||
Weighted average shares used for computation of:
|
||||||||||||
Basic loss per common share
|
88.8 | 88.4 | ||||||||||
Diluted loss per common share
|
88.8 | 88.4 | ||||||||||
Effective tax rate
|
NM
|
15.9% | ||||||||||
Supplemental Information
|
||||||||||||
Diluted loss per common share
|
$ | (0.08 | ) | $ | (1.29 | ) | ||||||
Restructuring, exit and impairment charges (1)
|
0.14 | 0.32 | ||||||||||
Special tax items
|
- | (0.24 | ) | |||||||||
Diluted earnings (loss) per common share, as adjusted
|
$ | 0.06 | $ | (1.21 | ) | |||||||
(1) The 2010 and 2009 Restructuring, exit and impairment charges assume no tax benefit.
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Brunswick Corporation
|
|||||||||||||
Comparative Consolidated Statements of Operations
|
|||||||||||||
(in millions, except per share data)
|
|||||||||||||
(unaudited)
|
|||||||||||||
Nine Months Ended
|
|||||||||||||
October 2,
|
October 3,
|
||||||||||||
2010
|
2009
|
% Change
|
|||||||||||
Net sales
|
$ | 2,674.5 | $ | 2,118.8 | 26% | ||||||||
Cost of sales
|
2,070.3 | 1,878.0 | 10% | ||||||||||
Selling, general and administrative expense
|
401.6 | 454.5 | -12% | ||||||||||
Research and development expense
|
67.8 | 64.7 | 5% | ||||||||||
Restructuring, exit and impairment charges
|
43.8 | 103.9 | -58% | ||||||||||
Operating earnings (loss)
|
91.0 | (382.3 | ) |
NM
|
|||||||||
Equity loss
|
(1.2 | ) | (11.1 | ) | 89% | ||||||||
Other expense, net
|
(1.6 | ) | (1.3 | ) | -23% | ||||||||
Earnings (loss) before interest, loss on early extinguishment of debt
|
88.2 | (394.7 | ) |
NM
|
|||||||||
and income taxes
|
|||||||||||||
Interest expense
|
(70.9 | ) | (60.1 | ) | -18% | ||||||||
Interest income
|
2.5 | 2.2 | 14% | ||||||||||
Loss on early extinguishment of debt
|
(5.5 | ) | (0.1 | ) |
NM
|
||||||||
Earnings (loss) before income taxes
|
14.3 | (452.7 | ) |
NM
|
|||||||||
Income tax provision
|
20.8 | 9.5 | |||||||||||
Net loss
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$ | (6.5 | ) | $ | (462.2 | ) | 99% | ||||||
Loss per common share:
|
|||||||||||||
Basic
|
$ | (0.07 | ) | $ | (5.23 | ) | |||||||
Diluted
|
$ | (0.07 | ) | $ | (5.23 | ) | |||||||
Weighted average shares used for computation of:
|
|||||||||||||
Basic loss per common share
|
88.7 | 88.4 | |||||||||||
Diluted loss per common share
|
88.7 | 88.4 | |||||||||||
Effective tax rate
|
NM
|
-2.1% | |||||||||||
Supplemental Information
|
|||||||||||||
Diluted loss per common share
|
$ | (0.07 | ) | $ | (5.23 | ) | |||||||
Restructuring, exit and impairment charges (1)
|
0.50 | 1.17 | |||||||||||
Special tax items
|
(0.01 | ) | 0.12 | ||||||||||
Diluted earnings (loss) per common share, as adjusted
|
$ | 0.42 | $ | (3.94 | ) | ||||||||
(1) The 2010 and 2009 Restructuring, exit and impairment charges assume no tax benefit.
|
Brunswick Corporation
|
|||||||||||||||||||||||||||||||||
Selected Financial Information
|
|||||||||||||||||||||||||||||||||
(in millions)
|
|||||||||||||||||||||||||||||||||
(unaudited)
|
|||||||||||||||||||||||||||||||||
Segment Information
|
|||||||||||||||||||||||||||||||||
Three Months Ended
|
|||||||||||||||||||||||||||||||||
Net Sales
|
Operating Earnings (Loss) (1)
|
Operating Margin
|
|||||||||||||||||||||||||||||||
October 2,
|
October 3,
|
%
|
October 2,
|
October 3,
|
%
|
October 2,
|
October 3,
|
||||||||||||||||||||||||||
2010
|
2009
|
Change
|
2010
|
2009
|
Change
|
2010
|
2009
|
||||||||||||||||||||||||||
Marine Engine
|
$ | 429.2 | $ | 363.5 | 18% | $ | 49.0 | $ | (13.4 | ) |
NM
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11.4% | -3.7% | ||||||||||||||||||||
Boat
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209.2 | 118.2 | 77% | (26.3 | ) | (86.7 | ) | 70% | -12.6% | -73.4% | |||||||||||||||||||||||
Marine eliminations
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(35.3 | ) | (20.1 | ) | - | - | |||||||||||||||||||||||||||
Total Marine
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603.1 | 461.6 | 31% | 22.7 | (100.1 | ) |
NM
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3.8% | -21.7% | ||||||||||||||||||||||||
Fitness
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137.7 | 126.8 | 9% | 17.0 | 12.5 | 36% | 12.3% | 9.9% | |||||||||||||||||||||||||
Bowling & Billiards
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74.6 | 77.5 | -4% | - | (3.8 | ) |
NM
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0.0% | -4.9% | ||||||||||||||||||||||||
Eliminations
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- | (0.1 | ) | - | - | ||||||||||||||||||||||||||||
Corp/Other
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- | - | (14.5 | ) | (18.0 | ) | 19% | ||||||||||||||||||||||||||
Total
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$ | 815.4 | $ | 665.8 | 22% | $ | 25.2 | $ | (109.4 | ) |
NM
|
3.1% | -16.4% | ||||||||||||||||||||
Nine Months Ended
|
|||||||||||||||||||||||||||||||||
Net Sales
|
Operating Earnings (Loss) (2)
|
Operating Margin
|
|||||||||||||||||||||||||||||||
October 2,
|
October 3,
|
%
|
October 2,
|
October 3,
|
%
|
October 2,
|
October 3,
|
||||||||||||||||||||||||||
2010 | 2009 |
Change
|
2010 | 2009 |
Change
|
2010 | 2009 | ||||||||||||||||||||||||||
Marine Engine
|
$ | 1,454.1 | $ | 1,122.6 | 30% | $ | 164.7 | $ | (71.8 | ) |
NM
|
11.3% | -6.4% | ||||||||||||||||||||
Boat
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749.4 | 462.3 | 62% | (76.6 | ) | (266.9 | ) | 71% | -10.2% | -57.7% | |||||||||||||||||||||||
Marine eliminations
|
(152.7 | ) | (71.2 | ) | - | - | |||||||||||||||||||||||||||
Total Marine
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2,050.8 | 1,513.7 | 35% | 88.1 | (338.7 | ) |
NM
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4.3% | -22.4% | ||||||||||||||||||||||||
Fitness
|
379.9 | 350.4 | 8% | 35.2 | 13.0 |
NM
|
9.3% | 3.7% | |||||||||||||||||||||||||
Bowling & Billiards
|
243.8 | 254.8 | -4% | 12.3 | 0.9 |
NM
|
5.0% | 0.4% | |||||||||||||||||||||||||
Eliminations
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- | (0.1 | ) | - | - | ||||||||||||||||||||||||||||
Corp/Other
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- | - | (44.6 | ) | (57.5 | ) | 22% | ||||||||||||||||||||||||||
Total
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$ | 2,674.5 | $ | 2,118.8 | 26% | $ | 91.0 | $ | (382.3 | ) |
NM
|
3.4% | -18.0% | |||||||||||||||||||
(1)
|
Operating earnings (loss) in the third quarter of 2010 includes $12.2 million of pretax restructuring, exit and impairment charges. The $12.2 million charge consists of $1.7 million in the Marine Engine segment, $10.2 million in the Boat segment, $0.2 million in the Bowling & Billiards segment and $0.1 million in Corp/Other. Operating earnings (loss) in the third quarter of 2009 includes $28.8 million of pretax restructuring, exit and impairment charges. The $28.8 million charge consists of $18.8 million in the Marine Engine segment, $6.6 million in the Boat segment, $0.4 million in the Fitness segment, $0.8 million in the Bowling & Billiards segment and $2.2 million in Corp/Other.
|
||||||||||||||||||||||||||||||||
(2)
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Operating earnings (loss) in the first nine months of 2010 includes $43.8 million of pretax restructuring, exit and impairment charges. The $43.8 million charge consists of $6.2 million in the Marine Engine segment, $36.0 million in the Boat segment, $0.1 million in the Fitness segment, $0.6 million in the Bowling & Billiards segment and $0.9 million in Corp/Other. Operating earnings (loss) in the first nine months of 2009 includes $103.9 million of pretax restructuring, exit and impairment charges. The $103.9 million charge consists of $40.1 million in the Marine Engine segment, $49.5 million in the Boat segment, $1.6 million in the Fitness segment, $4.8 million in the Bowling & Billiards segment and $7.9 million in Corp/Other.
|
||||||||||||||||||||||||||||||||
Brunswick Corporation
|
||||||||||||
Comparative Condensed Consolidated Balance Sheets
|
||||||||||||
(in millions)
|
||||||||||||
October 2,
|
December 31,
|
October 3,
|
||||||||||
2010
|
2009
|
2009
|
||||||||||
(unaudited)
|
(unaudited)
|
|||||||||||
Assets
|
||||||||||||
Current assets
|
||||||||||||
Cash and cash equivalents
|
$ | 676.5 | $ | 526.6 | $ | 624.1 | ||||||
Accounts and notes receivable, net
|
367.4 | 332.4 | 368.2 | |||||||||
Inventories
|
||||||||||||
Finished goods
|
245.8 | 234.4 | 238.8 | |||||||||
Work-in-process
|
177.5 | 174.3 | 182.9 | |||||||||
Raw materials
|
95.1 | 76.2 | 81.5 | |||||||||
Net inventories
|
518.4 | 484.9 | 503.2 | |||||||||
Deferred income taxes
|
1.8 | 79.3 | 13.1 | |||||||||
Prepaid expenses and other
|
30.0 | 35.5 | 34.6 | |||||||||
Current assets
|
1,594.1 | 1,458.7 | 1,543.2 | |||||||||
Net property
|
637.5 | 724.3 | 798.4 | |||||||||
Other assets
|
||||||||||||
Goodwill, net
|
291.1 | 292.5 | 292.6 | |||||||||
Other intangibles, net
|
59.6 | 75.6 | 78.5 | |||||||||
Investments
|
59.9 | 56.7 | 57.8 | |||||||||
Other long-term assets
|
89.5 | 101.6 | 109.9 | |||||||||
Other assets
|
500.1 | 526.4 | 538.8 | |||||||||
Total assets
|
$ | 2,731.7 | $ | 2,709.4 | $ | 2,880.4 | ||||||
Liabilities and shareholders' equity
|
||||||||||||
Current liabilities
|
||||||||||||
Short-term debt
|
$ | 4.3 | $ | 11.5 | $ | 11.5 | ||||||
Accounts payable
|
274.9 | 261.2 | 232.6 | |||||||||
Accrued expenses
|
623.3 | 633.9 | 628.4 | |||||||||
Current liabilities
|
902.5 | 906.6 | 872.5 | |||||||||
Long-term debt
|
829.8 | 839.4 | 904.8 | |||||||||
Other long-term liabilities
|
782.3 | 753.1 | 767.3 | |||||||||
Shareholders' equity
|
217.1 | 210.3 | 335.8 | |||||||||
Total liabilities and shareholders' equity
|
$ | 2,731.7 | $ | 2,709.4 | $ | 2,880.4 | ||||||
Supplemental Information
|
||||||||||||
Debt-to-capitalization rate
|
79.3% | 80.2% | 73.2% |
Brunswick Corporation
|
||||||||
Comparative Condensed Consolidated Statements of Cash Flows
|
||||||||
(in millions)
|
||||||||
(unaudited)
|
||||||||
Nine Months Ended
|
||||||||
October 2,
|
October 3,
|
|||||||
2010
|
2009
|
|||||||
Cash flows from operating activities
|
||||||||
Net loss
|
$ | (6.5 | ) | $ | (462.2 | ) | ||
Depreciation and amortization
|
98.5 | 119.8 | ||||||
Pension expense, net of funding
|
12.1 | 58.7 | ||||||
Provision for doubtful accounts
|
1.1 | 33.1 | ||||||
Deferred income taxes
|
5.4 | 9.9 | ||||||
Long-lived asset impairment charges
|
19.0 | 18.0 | ||||||
Equity in earnings of unconsolidated affiliates, net of dividends
|
1.4 | 11.4 | ||||||
Loss on early extinguishment of debt
|
5.5 | 0.1 | ||||||
Changes in certain current assets and current liabilities
|
(71.4 | ) | 314.3 | |||||
Income taxes
|
114.1 | 90.6 | ||||||
Repurchase of accounts receivable
|
- | (84.2 | ) | |||||
Other, net
|
13.4 | 20.8 | ||||||
Net cash provided by operating activities
|
192.6 | 130.3 | ||||||
Cash flows from investing activities
|
||||||||
Capital expenditures
|
(31.1 | ) | (20.2 | ) | ||||
Investments
|
(8.6 | ) | 7.5 | |||||
Proceeds from sale of property, plant and equipment
|
5.9 | 11.7 | ||||||
Other, net
|
8.3 | 1.9 | ||||||
Net cash provided by (used for) investing activities
|
(25.5 | ) | 0.9 | |||||
Cash flows from financing activities
|
||||||||
Net issuances (payments) of short-term debt
|
(6.8 | ) | 8.3 | |||||
Proceeds from asset-based lending facility
|
- | 81.1 | ||||||
Payments of asset-based lending facility
|
- | (81.1 | ) | |||||
Net proceeds from issuance of long-term debt
|
30.2 | 329.9 | ||||||
Payments of long-term debt including current maturities
|
(36.7 | ) | (162.6 | ) | ||||
Payments of premium on early extinguishment of debt
|
(5.3 | ) | (0.2 | ) | ||||
Net proceeds from stock compensation activity
|
1.4 | - | ||||||
Net cash provided by (used for) financing activities
|
(17.2 | ) | 175.4 | |||||
Net increase in cash and cash equivalents
|
149.9 | 306.6 | ||||||
Cash and cash equivalents at beginning of period
|
526.6 | 317.5 | ||||||
Cash and cash equivalents at end of period
|
$ | 676.5 | $ | 624.1 | ||||
Free Cash Flow
|
||||||||
Net cash provided by operating activities
|
$ | 192.6 | $ | 130.3 | ||||
Net cash provided by (used for):
|
||||||||
Capital expenditures
|
(31.1 | ) | (20.2 | ) | ||||
Proceeds from sale of property, plant and equipment
|
5.9 | 11.7 | ||||||
Other, net
|
8.3 | 1.9 | ||||||
Total free cash flow
|
$ | 175.7 | $ | 123.7 | ||||