Brunswick Corporation 1 N. Field Court Lake Forest, IL 60045
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Telephone 847.735.4700 Facsimile 847.735.4750
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Release:
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IMMEDIATE RELEASE
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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 $985.9 million, up 17 percent versus first quarter 2010.
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·
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Operating earnings improved by $56.9 million from first quarter 2010.
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·
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Net earnings of $0.30 per diluted share versus a net loss of $0.15 per diluted share in the prior year.
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·
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Cash and marketable securities totaled $548.7 million.
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Brunswick Corporation
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Comparative Consolidated Statements of Operations
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(in millions, except per share data)
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(unaudited)
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Three Months Ended
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April 2,
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April 3,
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|||||||||||
2011
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2010
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% Change
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Net sales
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$ | 985.9 | $ | 844.4 | 17% | |||||||
Cost of sales
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749.6 | 665.8 | 13% | |||||||||
Selling, general and administrative expense
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140.6 | 138.8 | 1% | |||||||||
Research and development expense
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23.4 | 22.3 | 5% | |||||||||
Restructuring, exit and impairment charges
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5.3 | 7.4 | -28% | |||||||||
Operating earnings
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67.0 | 10.1 |
NM
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Equity earnings (loss)
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0.5 | (0.1 | ) |
NM
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Other income, net
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- | 1.0 |
NM
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Earnings before interest, loss on early extinguishment of debt
and income taxes
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67.5 | 11.0 |
NM
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Interest expense
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(23.3 | ) | (24.3 | ) | -4% | |||||||
Interest income
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0.8 | 0.9 | -11% | |||||||||
Loss on early extinguishment of debt
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(4.3 | ) | (0.3 | ) |
NM
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Earnings (loss) before income taxes
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40.7 | (12.7 | ) |
NM
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Income tax provision
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13.2 | 0.3 | ||||||||||
Net earnings (loss)
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$ | 27.5 | $ | (13.0 | ) |
NM
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Earnings (loss) per common share:
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Basic
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$ | 0.31 | $ | (0.15 | ) | |||||||
Diluted
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$ | 0.30 | $ | (0.15 | ) | |||||||
Weighted average shares used for computation of:
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Basic earnings (loss) per common share
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89.1 | 88.6 | ||||||||||
Diluted earnings (loss) per common share
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92.5 | 88.6 | ||||||||||
Effective tax rate
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32.4 | % | -2.4 | % | ||||||||
Supplemental Information
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Diluted earnings (loss) per common share
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$ | 0.30 | $ | (0.15 | ) | |||||||
Restructuring, exit and impairment charges (1)
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0.05 | 0.08 | ||||||||||
Special tax items
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- | (0.02 | ) | |||||||||
Diluted earnings (loss) per common share, as adjusted
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$ | 0.35 | $ | (0.09 | ) | |||||||
(1) The 2011 and 2010 Restructuring, exit and impairment charges assume no tax benefit.
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Brunswick Corporation
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Selected Financial Information
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(in millions)
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(unaudited)
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Segment Information
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Three Months Ended
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Net Sales
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Operating Earnings (Loss) (1)
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Operating Margin
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April 2,
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April 3,
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April 2,
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April 3,
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April 2,
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April 3,
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||||||||||||||||||||||||||||
2011
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2010
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% Change
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2011
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2010
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% Change
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2011
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2010
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Marine Engine
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$ | 520.5 | $ | 445.7 | 17 | % | $ | 51.6 | $ | 26.5 | 95% | 9.9 | % | 5.9 | % | ||||||||||||||||||
Boat
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283.6 | 243.6 | 16 | % | (3.8 | ) | (26.7 | ) | -86% | -1.3 | % | -11.0 | % | ||||||||||||||||||||
Marine eliminations
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(61.9 | ) | (55.8 | ) | - | - | |||||||||||||||||||||||||||
Total Marine |
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742.2 | 633.5 | 17 | % | 47.8 | (0.2 | ) |
NM
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6.4 | % | 0.0 | % | ||||||||||||||||||||
Fitness
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156.4 | 119.0 | 31 | % | 23.4 | 9.5 |
NM
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15.0 | % | 8.0 | % | ||||||||||||||||||||||
Bowling & Billiards
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87.3 | 91.9 | -5 | % | 13.2 | 14.9 | -11% | 15.1 | % | 16.2 | % | ||||||||||||||||||||||
Corp/Other
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- | - | (17.4 | ) | (14.1 | ) | 23% | ||||||||||||||||||||||||||
Total | $ | 985.9 | $ | 844.4 | 17 | % | $ | 67.0 | $ | 10.1 |
NM
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6.8 | % | 1.2 | % | ||||||||||||||||||
(1) Operating earnings (loss) in the first quarter of 2011 includes $5.3 million of pretax restructuring, exit and impairment charges. The $5.3 million charge consists of $4.3 million in the Marine Engine segment and $1.0 million in the Boat segment. Operating earnings (loss) in the first quarter of 2010 includes $7.4 million of pretax restructuring and impairment charges. The $7.4 million charge consists of $2.4 million in the Marine Engine segment, $4.1 million in the Boat segment, $0.2 million in the Bowling & Billiards segment and $0.7 million in Corp/Other.
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Brunswick Corporation
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Comparative Condensed Consolidated Balance Sheets
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(in millions)
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April 2,
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December 31,
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April 3,
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||||||||||
2011
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2010
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2010
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(unaudited)
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(unaudited)
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Assets
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Current assets
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Cash and cash equivalents
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$ | 424.0 | $ | 551.4 | $ | 552.4 | ||||||
Short-term investments in marketable securities
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76.8 | 84.7 | 0.8 | |||||||||
Total cash, cash equivalents and short-term investments in
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500.8 | 636.1 | 553.2 | |||||||||
marketable securities
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Accounts and notes receivable, net
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469.2 | 327.3 | 440.1 | |||||||||
Inventories
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Finished goods
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292.1 | 276.9 | 237.2 | |||||||||
Work-in-process
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169.8 | 164.0 | 178.4 | |||||||||
Raw materials
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88.9 | 86.6 | 89.0 | |||||||||
Net inventories
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550.8 | 527.5 | 504.6 | |||||||||
Deferred income taxes
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16.2 | 17.0 | 19.8 | |||||||||
Prepaid expenses and other
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28.6 | 27.9 | 30.2 | |||||||||
Current assets
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1,565.6 | 1,535.8 | 1,547.9 | |||||||||
Net property
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615.9 | 630.2 | 696.1 | |||||||||
Other assets
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Goodwill, net
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292.5 | 290.9 | 290.6 | |||||||||
Other intangibles, net
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54.8 | 56.7 | 72.6 | |||||||||
Long-term investments in marketable securities
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47.9 | 21.0 | - | |||||||||
Equity investments
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56.2 | 53.7 | 53.2 | |||||||||
Other long-term assets
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90.5 | 89.7 | 97.7 | |||||||||
Other assets
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541.9 | 512.0 | 514.1 | |||||||||
Total assets
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$ | 2,723.4 | $ | 2,678.0 | $ | 2,758.1 | ||||||
Liabilities and shareholders' equity
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Current liabilities
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Short-term debt
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$ | 1.8 | $ | 2.2 | $ | 10.2 | ||||||
Accounts payable
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339.3 | 288.2 | 320.6 | |||||||||
Accrued expenses
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616.5 | 661.2 | 589.3 | |||||||||
Current liabilities
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957.6 | 951.6 | 920.1 | |||||||||
Long-term debt
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809.9 | 828.4 | 844.2 | |||||||||
Other long-term liabilities
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832.5 | 827.6 | 802.1 | |||||||||
Shareholders' equity
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123.4 | 70.4 | 191.7 | |||||||||
Total liabilities and shareholders' equity
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$ | 2,723.4 | $ | 2,678.0 | $ | 2,758.1 | ||||||
Supplemental Information
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Debt-to-capitalization rate
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86.8 | % | 92.2 | % | 81.7 | % | ||||||
Cash and cash equivalents
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$ | 424.0 | $ | 551.4 | $ | 552.4 | ||||||
Short-term investments in marketable securities
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76.8 | 84.7 | 0.8 | |||||||||
Long-term investments in marketable securities
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47.9 | 21.0 | - | |||||||||
Total cash and marketable securities
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$ | 548.7 | $ | 657.1 | $ | 553.2 | ||||||
Brunswick Corporation
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Comparative Condensed Consolidated Statements of Cash Flows
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(in millions)
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(unaudited)
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Three Months Ended
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April 2,
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April 3,
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|||||||
2011
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2010
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Cash flows from operating activities
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Net earnings (loss)
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$ | 27.5 | $ | (13.0 | ) | |||
Depreciation and amortization
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28.4 | 35.1 | ||||||
Pension expense, net of funding
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7.2 | 9.0 | ||||||
(Gains) losses on sale of property, plant and equipment, net
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(7.4 | ) | 0.5 | |||||
Deferred income taxes
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3.1 | 0.3 | ||||||
Other long-lived asset impairment charges
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0.3 | 0.5 | ||||||
Loss on early extinguishment of debt
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4.3 | 0.3 | ||||||
Changes in certain current assets and current liabilities
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(169.6 | ) | (111.6 | ) | ||||
Income taxes
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5.2 | 107.5 | ||||||
Other, net
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17.9 | (0.5 | ) | |||||
Net cash provided by (used for) operating activities
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(83.1 | ) | 28.1 | |||||
Cash flows from investing activities
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Capital expenditures
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(13.2 | ) | (8.6 | ) | ||||
Purchase of marketable securities
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(39.7 | ) | - | |||||
Sales of maturities of marketable securities
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20.0 | - | ||||||
Investments
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(0.4 | ) | (0.3 | ) | ||||
Proceeds from sale of property, plant and equipment
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10.4 | 1.0 | ||||||
Other, net
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2.8 | - | ||||||
Net cash used for investing activities
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(20.1 | ) | (7.9 | ) | ||||
Cash flows from financing activities
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Net payments of short-term debt
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(0.4 | ) | (0.6 | ) | ||||
Net proceeds from issuances of long-term debt
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- | 10.0 | ||||||
Payments of long-term debt including current maturities
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(19.1 | ) | (3.5 | ) | ||||
Payments of premium on early extinguishment of debt
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(4.3 | ) | (0.3 | ) | ||||
Net proceeds from stock compensation activity
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4.2 | - | ||||||
Other, net
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(4.6 | ) | - | |||||
Net cash provided by (used for) financing activities
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(24.2 | ) | 5.6 | |||||
Net increase (decrease) in cash and cash equivalents
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(127.4 | ) | 25.8 | |||||
Cash and cash equivalents at beginning of period
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551.4 | 526.6 | ||||||
Cash and cash equivalents at end of period
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$ | 424.0 | $ | 552.4 | ||||
Free Cash Flow
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Net cash provided by operating activities
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$ | (83.1 | ) | $ | 28.1 | |||
Net cash provided by (used for):
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Capital expenditures
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(13.2 | ) | (8.6 | ) | ||||
Proceeds from sale of property, plant and equipment
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10.4 | 1.0 | ||||||
Other, net
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2.8 | - | ||||||
Total free cash flow
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$ | (83.1 | ) | $ | 20.5 | |||