21st Annual CJS Securities New Ideas for the New Year Virtual Conference

Jeremy Smeltser

Kevin Kim

January 13, 2021

Forward-Looking Statements

This presentation contains, and certain oral and written statements made by our representatives from time to time may contain, forward-looking statements, including, without limitation, statements or expectations regarding our Global Productivity Improvement Plan, our business strategy, future operations, financial condition, estimated revenues, projected costs, projected synergies, prospects, plans and objectives of management, information concerning expected actions of third parties, retention and future compensation of key personnel, our ability to meet environmental, social, and governance goals, the expected impact of the COVID-19 pandemic, economic, social and political conditions or civil unrest in the U.S. and other countries, and other statements regarding the Company's ability to meet its expectations for its fiscal 2020. When used in this document, the words future, anticipate, pro forma, seeks, intend, plan, envision, estimate, believe, belief, expect, project, forecast, outlook, goal, target, could, would, will, can, should, may and similar expressions are also intended to identify forward-looking statements, although not all forward-looking statements contain such identifying words.

Since these forward-looking statements are based upon our current expectations of future events and projections and are subject to a number of risks and uncertainties, many of which are beyond our control and some of which may change rapidly, actual results or outcomes may differ materially from those expressed or implied herein, and you should not place undue reliance on these statements. Important factors that could cause our actual results to differ materially from those expressed or implied herein include, without limitation: (1) the impact of the COVID-19 pandemic on our customers, employees, manufacturing facilities, suppliers, the capital markets and our financial condition, and results of operations, all of which tend to aggravate the other risks and uncertainties we face; (2) the impact of our indebtedness on our business, financial condition and results of operations; (3) the impact of restrictions in our debt instruments on our ability to operate our business, finance our capital needs or pursue or expand business strategies; (4) any failure to comply with financial covenants and other provisions and restrictions of our debt instruments; (5) the effects of general economic conditions, including the impact of, and changes to tariffs and trade policies, inflation, recession or fears of a recession, depression or fears of a depression, labor costs and stock market volatility or monetary or fiscal policies in the countries where we do business; (6) the impact of fluctuations in commodity prices, costs or availability of raw materials or terms and conditions available from suppliers, including suppliers' willingness to advance credit; (7) interest rate and exchange rate fluctuations; (8) the loss of, significant reduction in, or dependence upon, sales to any significant retail customer(s); (9) competitive promotional activity or spending by competitors, or price reductions by competitors; (10) the introduction of new product features or technological developments by competitors and/or the development of new competitors or competitive brands; (11) the impact of actions taken by significant stockholders; (12) changes in consumer spending preferences and demand for our products, particularly in light of the COVID-19 pandemic and economic stress; (13) our ability to develop and successfully introduce new products, protect our intellectual property and avoid infringing the intellectual property of third parties; (14) our ability to successfully identify, implement, achieve and sustain productivity improvements (including our Global Productivity Improvement Plan), cost efficiencies (including at our manufacturing and distribution operations), and cost savings; (15) the seasonal nature of sales of certain of our products; (16) the effects of climate change and unusual weather activity, as well as further natural disasters and pandemics; (17) the cost and effect of unanticipated legal, tax or regulatory proceedings or new laws or regulations (including environmental, public health and consumer protection regulations); (18) our discretion to conduct, suspend or discontinue our share repurchase program (including our discretion to conduct purchases, if any, in a variety of manners including open- market purchases or privately negotiated transactions); (19) public perception regarding the safety of products that we manufacture and sell, including the potential for environmental liabilities, product liability claims, litigation and other claims related to products manufactured by us and third parties; (20) the impact of existing, pending or threatened litigation, government regulations or other requirements or operating standards applicable to our business; (21) the impact of cybersecurity breaches or our actual or perceived failure to protect company and personal data, including our failure to comply with new and increasingly complex global data privacy regulations; (22) changes in accounting policies applicable to our business; (23) our ability to utilize net operating loss carry-forwards to offset tax liabilities from future taxable income; (24) the impact of expenses resulting from the implementation of new business strategies, divestitures or current and proposed restructuring activities; (25) our ability to successfully implement further acquisitions or dispositions and the impact of any such transactions on our financial performance; (26) the unanticipated loss of key members of senior management and the transition of new members of our management teams to their new roles; (27) the impact of economic, social and political conditions or civil unrest in the U.S. and other countries; (28) the effects of political or economic conditions, terrorist attacks, acts of war, natural disasters, public health concerns or other unrest in international markets; (29) our ability to achieve our goals regarding environmental, social and governance practices; (30) our increased reliance on third-party partners, suppliers, and distributors to achieve our business objectives; and (31) the other risk factors set forth in the securities filings of Spectrum Brands Holdings, Inc. and SB/RH Holdings, LLC, including their most recently filed Annual Report on Form 10-K and subsequent Quarterly Report(s) on Form 10-Q.

Some of the above-mentioned factors are described in further detail in the sections entitled "Risk Factors" in our annual and quarterly reports, as applicable. You should assume the information appearing in this document is accurate only as of the date hereof, or as otherwise specified, as our business, financial condition, results of operations and prospects may have changed since such date. Except as required by applicable law, including the securities laws of the United States and the rules and regulations of the United States Securities and Exchange Commission, we undertake no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise, to reflect actual results or changes in factors or assumptions affecting such forward- looking statements.

2

Reconciliation of Non-GAAP Financial Measurements

Management believes that certain non-GAAP financial measures may be useful in certain instances to provide additional meaningful comparisons between current results and results in prior operating periods. Within this presentation, including the tables that follow, reference is made to organic net sales, adjusted earnings before interest, taxes, depreciation and amortization (EBITDA), adjusted EBITDA margin, adjusted earnings per share (EPS) and adjusted Free Cash Flow.

Management believes that organic net sales provide for a more complete understanding of underlying business trends of regional and segment performance by excluding the impact of currency exchange fluctuations and the impact of acquisitions (when applicable) when there is no comparable sales in the prior period. Organic growth is calculated by comparing organic net sales to net sales in the prior year. The effect of changes in currency exchange rates is determined by translating the period's net sales using the currency exchange rates that were in effect during the prior comparative period. Adjusted EBITDA is a metric used by management to evaluate segment performance and frequently used by the financial community which provides insight into an organization's operating trends and facilitates comparisons between peer companies, because interest, taxes, depreciation and amortization can differ greatly between organizations as a result of differing capital structures and tax strategies. Adjusted EBITDA can also be a useful measure for determining Spectrum Brands' debt covenant compliance. Adjusted EBITDA excludes certain items that are unusual in nature or not comparable from period to period. Adjusted EBITDA margin reflects adjusted EBITDA as a percentage of net sales. Management uses adjusted diluted EPS as a useful measure for providing further insight into our operating performance because it eliminates the effects of certain items that are not comparable from one period to the next. An income tax adjustment is included in adjusted diluted EPS to exclude the impact of the valuation allowance against deferred taxes and other tax-related items in order to reflect a normalized ongoing effective tax rate. Adjusted free cash flow provides useful information to investors regarding our ability to generate cash from business operations that is available for acquisitions and other investments, service of debt principal, dividends and share repurchases and meet its working capital requirements. Our definition of adjusted free cash flow takes into consideration capital investments required to maintain operations of our businesses and execute our strategy. For the three and twelve month periods ended September 30, 2020, the normalized ongoing effective tax rate was 25.0%.

Spectrum Brands provides this information to investors to assist in comparisons of past, present and future operating results and to assist in highlighting the results of on-going operations. While Spectrum Brands' management believes that non-GAAP measurements are useful supplemental information, such adjusted results are not intended to replace the Spectrum Brands' GAAP financial results and should be read in conjunction with those GAAP results. Supplemental tables have been provided within this presentation to demonstrate reconciliation of non-GAAP measurements discussed in the most relevant GAAP financial measurements.

The Company provides this information to investors to assist in comparisons of past, present and future operating results and to assist in highlighting the results of ongoing operations. While Spectrum Brands' management believes that non-GAAP measurements are useful supplemental information, such adjusted results are not intended to replace the Spectrum Brands' GAAP financial results and should be read in conjunction with those GAAP results. Reconciliations of all non-GAAP measures to the most comparable GAAP measure have been provided in the Appendix to this presentation.

3

Spectrum Brands- Snapshot

DIVERSE BUSINESS UNITS

GEOGRAPHIC CONCENTRATION

Hardware & Home Improvement

34% of Net Sales

44% of Adjusted EBITDA*

Home & Personal Care

28% of Net Sales

16% of Adjusted EBITDA*

aa

Global Pet Care

24% of Net Sales

North

Latin

30% of Adjusted EBITDA*

75%

America

5%

America

($2,973M)

($198M)

Home & Garden

14% of Net Sales

17%

Europe

3%

Asia-Pacific

19% of Adjusted EBITDA*

($674M)

($118M)

PRODUCT CONCENTRATION

Top 15 Brands = 81% of FY20 Revenue

Note: Fiscal 2020 Financials

4

* Total Company Adjusted EBITDA includes $52M of corporate costs not allocated to the segments.

SPB - A Home Essentials Company - We Are

Investing In Our Brands

HPC

GPC

HHI

H&G

5

Milestone Year in 2020

One Team: Better, Faster and Stronger Together

Adapted, survived and thrived during pandemic

  • Protected employees, avoided substantial cuts or pay reductions
  • Timely launched Cutter hand sanitizer and Nature's Miracle disinfectant

Shifted focus to a "Home Essentials" company

  • Created new content to support brands and consumers
  • Incremental investments in advertising and promotion

Continued laser-focus on Global Productivity Improvement Program (GPIP)

  • Targeting gross annualized savings of $150M, most of the savings being reinvested back into growth initiatives, R&D, consumer insights and marketing
  • Established Centers of Excellence

Enhanced liquidity to over $1.1B and maintained a strong balance sheet

  • Net leverage improved to 3.4x at the end of fourth quarter 2020
  • Ended fiscal 2020 with a cash balance of $532M
  • Announced the acquisition of Armitage to our fast-growing Global Pet Care business

6

Significant Progress, Improved Financials & Positive Outlook

+2.3%

+4.3%

3.95x

$567M

$580M

$3.96B

3.41x

$3.80B

Q3 FY20

Q4 FY20

FY19

FY20

FY19

FY20

Net Leverage

Adjusted EBITDA

Net Sales

F Y 2 1

+ 3 % t o + 5 %

+ M i d

$ 2 5 0 M - $ 2 7 0 M

S i n g l e - D i g i t s

N e t S a l e s

A d j . E B I T D A

A d j . F C F

Note: Earnings Framework as of November 13, 2020

7

Hardware & Home Improvement

2020 Financials

Net Sales(1)

$1.3 billion

(1.0)%

Adjusted EBITDA(1) (2)

$256 million

1.0%

Leading provider of residential security, builders' hardware, and plumbing

fixtures

Leading market positions:

‐ #1 in U.S. residential and luxury security

‐ #1 in U.S. builders' hardware

‐ #1 in Canada residential security

Residential Security

‐ #3 in U.S. retail plumbing fixtures

67%

Well-recognized brands with outstanding new product innovation and

Builders' Hardware

execution

12%

Large installed lock base with positive market trends in home automation

Plumbing & Accessories

FY 20

Vertically integrated global supply chain

21%

Net Sales

by Product Category

(1) Full year 2020 financials

8

(2) Total Company Adjusted EBITDA includes $52M of corporate costs not allocated to the segments.

.

Home & Personal Care

2020 Financials

Net Sales(1)

$1.1 billion

3.7%

Adjusted EBITDA(1) (2)

$92 million

5.7%

Personal Care

42%

  • A global provider of Home and Personal Care appliances
  • Leading market positions:
    • #1 brand in indoor grills worldwide
    • #1 brand in toaster ovens, garment care in US
    • #1 brand in kitchen/home products in UK

‐ #1 hair appliance brand in Europe, Australasia and several Latin American markets

  • Trusted brands with a history of delivering approachable innovation that simplifies consumer's everyday lives

Home Appliances

Proven agile and efficient new product development and supply

58%

FY 20

chain capabilities delivering competitive high-quality products

Net Sales

by Product

Category

(1) Full year 2020 financials

9

(2) Total Company Adjusted EBITDA includes $52M of corporate costs not allocated to the segments.

.

Global Pet Care

2020 Financials

Net Sales(1)

$963 million

10.6%

Adjusted EBITDA(1) (2)

$172 million

20.6%

Global Market Leader

‐

#1 in Aquatics

‐ #1 in Dog Chews

‐ #1 in Pet Grooming

‐ #1 in Pet Stain & Odor

Large Portfolio of Recognized Brands

Diverse & Growing Categories

Strong Global IP Portfolio

Companion

Aquatics

Animal

FY 20

69%

31%

Net Sales

by Product

Category

(1) Full year 2020 financials

10

(2) Total Company Adjusted EBITDA includes $52M of corporate costs not allocated to the segments.

.

Home & Garden

2020 Financials

Net Sales(1)

$552 million

8.6%

Adjusted EBITDA(1) (2)

$112 million

6.3%

  • Leading provider of consumer pest control solutions in the US
  • Leading market positions:
    • #1 in Outdoor Insect control
    • #1 in Mosquito Area Repellents
    • #1 in Bed Bug control
  • Strong new product pipeline developed from consumer-ledinnovation process
  • Growing distribution from new products and core product

Household

Controls

expansion

41%

34%

Agile and efficient, US-centric manufacturing

FY 20

Net Sales

by Product

Category

Repellents

25%

(1) Full year 2020 financials

11

(2) Total Company Adjusted EBITDA includes $52M of corporate costs not allocated to the segments.

.

Key Investment Highlights

1 Business restructuring including divestitures has resulted in four leading segments and much stronger balance sheet / liquidity position

2 Diverse portfolio of strong brands with barriers to entry and long-standing retailer relationships

  1. Innovation and better execution leading to distribution wins across the business
  2. Global Productivity Improvement Plan underway to improve margins and free cash flow generation

5 Experienced and proven management team

6 Formed a dedicated global COVID-19 response team

12

Appendix

SPECTRUM BRANDS HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF INCOME (Unaudited)

Three Month Period Ended

Twelve Month Period Ended

(in millions, except per share amounts)

September 30, 2020

September 30, 2019

September 30, 2020

September 30, 2019

Net sales

$

1,170.6

$

993.0

$

3,964.2

$

3,802.1

Cost of goods sold

745.8

657.0

2,580.0

2,492.4

Restructuring and related charges

1.8

1.3

14.3

2.8

Gross profit

423.0

334.7

1,369.9

1,306.9

Selling

177.2

141.5

614.5

600.5

General and administrative

92.1

90.9

337.8

354.6

Research and development

12.1

10.8

41.8

43.5

Restructuring and related charges

9.2

22.2

58.3

62.9

Transaction related charges

5.7

5.4

23.1

21.8

Loss on assets held for sale

-

-

26.8

-

Write-off from impairment of goodwill

-

116.0

-

116.0

Write-off from impairment of intangible assets

-

35.4

24.2

35.4

Total operating expenses

296.3

422.2

1,126.5

1,234.7

Operating income

126.7

(87.5)

243.4

72.2

Interest expense

38.0

37.0

144.5

222.1

Gain from extinguishment of Salus CLO debt

-

-

(76.2)

-

Other non-operating expense (income), net

9.3

(20.3)

19.7

43.9

Income (loss) from continuing operations before income taxes

79.4

(104.2)

155.4

(193.8)

Income tax expense (benefit)

35.6

(25.2)

70.9

(7.1)

Net income (loss) from continuing operations

43.8

(79.0)

84.5

(186.7)

Income (loss) from discontinued operations, net of tax

1.7

(16.7)

14.0

682.5

Net income (loss)

45.5

(95.7)

98.5

495.8

Net income attributable to non-controlling interest

0.1

-

0.7

1.3

Net income (loss) attributable to controlling interest

$

45.4

$

(95.7)

$

97.8

$

494.5

Amounts attributable to controlling interest

Net income (loss) from continuing operations attributable to controlling interest

$

43.7

$

(79.0)

$

83.8

$

(188.0)

Net income (loss) from discontinued operations attributable to controlling interest

1.7

(16.7)

14.0

682.5

Net income (loss) attributable to controlling interest

$

45.4

$

(95.7)

$

97.8

$

494.5

Earnings Per Share

Basic earnings per share from continuing operations

$

1.01

$

(1.62)

$

1.88

$

(3.71)

Basic earnings per share from discontinued operations

0.04

(0.35)

0.31

13.47

Basic earnings per share

$

1.05

$

(1.97)

$

2.19

$

9.76

Diluted earnings per share from continuing operations

$

1.01

$

(1.62)

$

1.87

$

(3.71)

Diluted earnings per share from discontinued operations

0.04

(0.35)

0.31

13.47

Diluted earnings per share

$

1.05

$

(1.97)

$

2.18

$

9.76

Weighted Average Shares Outstanding

Basic

43.1

48.8

44.7

50.7

Diluted

43.4

48.8

44.9

50.7

14

SPECTRUM BRANDS HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOW (Unaudited)

Twelve Month Period Ended

(in millions)

September 30, 2020

September 30, 2019

Cash flows from operating activities

Net cash provided by operating activities from continuing operations

$

290.1

$

83.5

Net cash provided (used) by operating activities from discontinued operations

0.2

(82.4)

Net cash provided by operating activities

290.3

1.1

Cash flows from investing activities

Purchases of property, plant and equipment

(61.0)

(58.4)

Proceeds from disposal of property, plant and equipment

4.2

2.1

Proceeds from sale of assets held for sale

29.0

-

Proceeds from sale of discontinued operations, net of cash

3.6

2,859.5

Business acquisitions, net of cash acquired

(16.9)

-

Proceeds from sale of equity investment

147.1

-

Other investing activity

2.3

(0.3)

Net cash provided by investing activities from continuing operations

108.3

2,802.9

Net cash used by investing activities from discontinued operations

-

(5.3)

Net cash provided by investing activities

108.3

2,797.6

Cash flows from financing activities

Payment of debt, including premium on extinguishment

(135.5)

(2,649.9)

Proceeds from issuance of debt

300.0

300.0

Payment of debt issuance costs

(11.5)

(4.1)

Treasury stock purchases

(239.8)

(268.5)

Accelerated share repurchase

(125.0)

-

Dividends paid to shareholders

(75.2)

(85.5)

Dividends paid by subsidiary to non-controlling interest

(0.8)

(1.1)

Share based award tax withholding payments, net of proceeds upon vesting

(12.6)

(4.4)

Payment of contingent consideration

(197.0)

(8.9)

Other financing activities, net

0.3

-

Net cash used by financing activities from continuing operations

(497.1)

(2,722.4)

Net cash used by financing activities from discontinued operations

-

(2.2)

Net cash used by financing activities

(497.1)

(2,724.6)

Effect of exchange rate changes on cash and cash equivalents

5.1

(8.4)

Net change in cash, cash equivalents and restricted cash in continuing operations

$

(93.4)

$

65.7

Cash, cash equivalents, and restricted cash, beginning of period

627.1

561.4

Cash, cash equivalents, and restricted cash, end of period

$

533.7

627.1

15

SPECTRUM BRANDS HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF FINANCIAL POSITION (Unaudited)

(in millions)

September 30, 2020

September 30, 2019

Assets

Cash and cash equivalents

$

531.6

$

627.1

Trade receivables, net

501.1

356.7

Other receivables

74.2

74.2

Inventories

557.7

548.4

Prepaid expenses and other current assets

63.5

53.5

Total current assets

1,728.1

1,659.9

Property, plant and equipment, net

396.5

452.9

Operating lease assets

103.8

-

Investments

66.9

230.8

Deferred charges and other

48.3

67.2

Goodwill

1,332.0

1,328.1

Intangible assets, net

1,431.7

1,507.1

Total assets

$

5,107.3

$

5,246.0

Liabilities and Shareholders' Equity

Current portion of long-term debt

$

15.3

$

136.9

Accounts payable

557.5

456.8

Accrued wages and salaries

95.0

72.1

Accrued interest

38.5

29.3

Indemnification payable to Energizer

33.0

230.8

Other current liabilities

205.6

214.2

Total current liabilities

944.9

1,140.1

Long-term debt, net of current portion

2,461.0

2,214.4

Long-term operating lease liabilities

88.8

-

Deferred income taxes

65.4

50.6

Other long-term liabilities

131.4

112.0

Total liabilities

3,691.5

3,517.1

Total shareholders' equity

1,407.5

1,720.9

Noncontrolling interest

8.3

8.0

Total equity

1,415.8

1,728.9

Total liabilities and equity

$

5,107.3

$

5,246.0

16

SPECTRUM BRANDS HOLDINGS, INC.

RECONCILIATION OF GAAP DILUTED EARNINGS PER SHARE TO ADJUSTED DILUTED EARNINGS PER SHARE (Unaudited)

Three Month Period Ended

Twelve Month Period Ended

September 30, 2020

September 30, 2019

September 30, 2020

September 30, 2019

Diluted EPS from continuing operations, as reported

$

1.01

$

(1.62)

$

1.87

$

(3.71)

Adjustments:

Restructuring and related charges

0.25

0.48

1.62

1.30

Transaction related charges

0.13

0.11

0.51

0.43

Debt refinancing costs

-

0.09

0.06

1.09

Loss (Gain) on Energizer investment

0.20

(0.53)

0.38

0.24

Loss on assets held for sale

-

-

0.60

-

Write-off from impairment of goodwill

-

2.38

-

2.29

Write-off from impairment of intangible assets

-

0.73

0.54

0.70

Foreign currency change on multicurrency divestiture loans

(0.03)

0.14

0.09

0.71

Legal and environmental reserves

-

0.21

-

0.20

Salus

-

0.01

0.01

0.03

Salus CLO debt extinguishment

-

-

(1.70)

-

GPC safety recall

-

-

-

0.01

Depreciation & amortization on HPC long-lived assets

-

-

-

0.57

Other

(0.09)

0.04

(0.09)

0.10

Income tax adjustment

0.25

(0.91)

0.21

(1.10)

Total adjustments

0.71

2.75

2.23

6.57

Diluted EPS from continuing operations, as adjusted

$

1.72

$

1.13

$

4.10

$

2.86

17

SPECTRUM BRANDS HOLDINGS, INC.

TRANSACTION RELATED CHARGES (Unaudited)

Three Month Period Ended

Twelve Month Period Ended

(in millions)

September 30, 2020

September 30, 2019

September 30, 2020

September 30, 2019

Coevorden operations divestiture

$

2.1

$

-

$

5.5

$

-

GBL post divestiture separation

2.6

3.6

10.2

9.5

HPC divestiture

0.3

1.2

3.9

7.3

Omega Sea acquisition

0.1

-

1.6

-

Other integration

0.6

0.6

1.9

5.0

Total transaction-related charges

$

5.7

$

5.4

$

23.1

$

21.8

SPECTRUM BRANDS HOLDINGS, INC.

RESTRUCTURING AND RELATED CHARGES (Unaudited)

Three Month Period Ended

Twleve Month Period Ended

(in millions)

September 30, 2020

September 30, 2019

September 30, 2020

September 30, 2019

Global productivity improvement plan

$

11.5

$

22.8

$

71.6

$

60.9

HHI distribution center consolidation

-

-

-

2.3

Other restructuring activities

(0.5)

0.7

1.0

2.5

Total restructuring and related charges

$

11.0

$

23.5

$

72.6

$

65.7

18

SPECTRUM BRANDS HOLDINGS, INC.

NET SALES SUMMARY (Unaudited)

Three Month Period Ended

Twelve Month Period Ended

(in millions, except %)

September 30, 2020

September 30, 2019

Variance

September 30, 2020

September 30, 2019

Variance

HHI

$

433.7

$

364.9

$

68.8

18.9 %

$

1,342.1

$

1,355.7

$

(13.6)

(1.0)%

HPC

302.3

285.8

16.5

5.8 %

1,107.6

1,068.1

39.5

3.7 %

GPC

278.3

228.9

49.4

21.6 %

962.6

870.2

92.4

10.6 %

H&G

156.3

113.4

42.9

37.8 %

551.9

508.1

43.8

8.6 %

Net Sales

$

1,170.6

$

993.0

177.6

17.9 %

$

3,964.2

$

3,802.1

162.1

4.3 %

SPECTRUM BRANDS HOLDINGS, INC.

RECONCILIATION OF GAAP NET SALES TO ORGANIC NET SALES (Unaudited)

September 30, 2020

Net Sales

Net Sales Excluding

Effect of Changes in

Effect of Changes in

Organic

Three Month Period Ended

Net Sales

Currency

Currency

Effect of Acquisitions

Net Sales

September 30, 2019

Variance

HHI

$

433.7

$

(0.5)

$

433.2

$

-

$

433.2

$

364.9

$

68.3

18.7 %

HPC

302.3

(0.5)

301.8

-

301.8

285.8

16.0

5.6 %

GPC

278.3

(3.2)

275.1

(3.8)

271.3

228.9

42.4

18.5 %

H&G

156.3

-

156.3

-

156.3

113.4

42.9

37.8 %

Total

$

1,170.6

$

(4.2)

$

1,166.4

$

(3.8)

$

1,162.6

$

993.0

169.6

17.1 %

September 30, 2020

Net Sales

Net Sales Excluding

Effect of Changes in

Effect of Changes in

Organic

Twelve Month Period Ended

Net Sales

Currency

Currency

Effect of Acquisitions

Net Sales

September 30, 2019

Variance

HHI

$

1,342.1

$

0.4

$

1,342.5

$

-

$

1,342.5

$

1,355.7

$

(13.2)

(1.0)%

HPC

1,107.6

18.9

1,126.5

-

1,126.5

1,068.1

58.4

5.5 %

GPC

962.6

1.1

963.7

(7.5)

956.2

870.2

86.0

9.9 %

H&G

551.9

0.1

552.0

-

552.0

508.1

43.9

8.6 %

Total

$

3,964.2

$

20.5

$

3,984.7

$

(7.5)

$

3,977.2

$

3,802.1

175.1

4.6 %

19

SPECTRUM BRANDS HOLDINGS, INC.

RECONCILIATION OF GAAP NET INCOME TO ADJUSTED EBITDA AND ADJUSTED EBITDA MARGIN (Unaudited)

Three Month Period Ended September 30, 2020 (in millions, except %)

HHI

HPC

GPC

H&G

Corporate

Consolidated

Net income from continuing operations

$

91.5

$

11.3

$

35.3

$

26.4

$

(120.7)

$

43.8

Income tax expense

-

-

-

-

35.6

35.6

Interest expense

-

-

-

-

38.0

38.0

Depreciation and amortization

8.8

8.8

9.3

5.0

3.6

35.5

EBITDA

100.3

20.1

44.6

31.4

(43.5)

152.9

Share and incentive based compensation

-

-

-

-

0.3

0.3

Restructuring and related charges

0.1

1.0

1.9

0.2

7.8

11.0

Transaction related charges

-

1.5

3.4

-

0.8

5.7

Loss on Energizer investment

-

-

-

-

8.7

8.7

Foreign currency loss on multicurrency divestiture loans

-

0.2

-

-

(1.3)

(1.1)

Other

-

(0.1)

-

(0.1)

(4.0)

(4.2)

Adjusted EBITDA

$

100.4

$

22.7

$

49.9

$

31.5

$

(31.2)

$

173.3

Net Sales

$

433.7

$

302.3

$

278.3

$

156.3

$

-

$

1,170.6

Adjusted EBITDA Margin

23.1 %

7.5 %

17.9 %

20.2 %

- %

14.8 %

Three Month Period Ended September 30, 2019 (in millions, except %)

HHI

HPC

GPC

H&G

Corporate

Consolidated

Net income (loss) from continuing operations

$

69.1

$

(118.8)

$

6.1

$

14.1

$

(49.5)

$

(79.0)

Income tax benefit

-

-

-

-

(25.2)

(25.2)

Interest expense

-

-

-

-

37.0

37.0

Depreciation and amortization

8.3

8.9

16.8

4.9

3.5

42.4

EBITDA

77.4

(109.9)

22.9

19.0

(34.2)

(24.8)

Share and incentive based compensation

-

-

-

-

14.9

14.9

Restructuring and related charges

0.4

3.4

1.2

0.4

18.1

23.5

Transaction related charges

-

1.1

1.0

-

3.3

5.4

Gain on Energizer investment

-

-

-

-

(26.1)

(26.1)

Write-off from impairment of goodwill

-

116.0

-

-

-

116.0

Write-off from impairment of intangible assets

-

18.8

16.6

-

-

35.4

Foreign currency loss on multicurrency divestiture loans

-

-

-

-

6.7

6.7

Legal and environmental remediation reserves

-

-

-

-

10.0

10.0

Salus

-

-

-

-

0.4

0.4

Other

-

-

-

0.2

1.5

1.7

Adjusted EBITDA

$

77.8

$

29.4

$

41.7

$

19.6

$

(5.4)

$

163.1

Net Sales

$

364.9

$

285.8

$

228.9

$

113.4

$

-

$

993.0

Adjusted EBITDA Margin

21.3%

10.3%

18.2%

17.3 %

-

16.4%

20

SPECTRUM BRANDS HOLDINGS, INC.

RECONCILIATION OF GAAP NET INCOME TO ADJUSTED EBITDA AND ADJUSTED EBITDA MARGIN (Unaudited)

Twelve Month Period Ended September 30, 2020 (in millions, except %)

HHI

HPC

GPC

H&G

Corporate

Consolidated

Net income from continuing operations

$

221.4

$

42.9

$

44.9

$

91.2

$

(315.9)

$

84.5

Income tax expense

-

-

-

-

70.9

70.9

Interest expense

-

-

-

-

144.5

144.5

Depreciation and amortization

33.9

35.2

44.4

20.4

14.6

148.5

EBITDA

255.3

78.1

89.3

111.6

(85.9)

448.4

Share and incentive based compensation

-

-

-

-

43.6

43.6

Restructuring and related charges

1.0

4.6

20.8

0.5

45.7

72.6

Transaction related charges

-

8.8

10.8

-

3.5

23.1

Loss on Energizer investment

-

-

-

-

16.8

16.8

Loss on assets held for sale

-

-

26.8

-

-

26.8

Write-off from impairment of intangible assets

-

-

24.2

-

-

24.2

Foreign currency loss on multicurrency divestiture loans

-

0.6

-

-

3.2

3.8

Salus

-

-

-

-

0.6

0.6

Salus CLO debt extinguishment

-

-

-

-

(76.2)

(76.2)

Other

-

0.1

0.1

-

(3.7)

(3.5)

Adjusted EBITDA

$

256.3

$

92.2

$

172.0

$

112.1

$

(52.4)

$

580.2

Net Sales

$

1,342.1

$

1,107.6

$

962.6

$

551.9

$

-

$

3,964.2

Adjusted EBITDA Margin

19.1%

8.3%

17.9%

20.3%

-

14.6%

Twelve Month Period Ended September 30, 2019 (in millions, except %)

HHI

HPC

GPC

H&G

Corporate

Consolidated

Net income (loss) from continuing operations

$

214.6

$

(127.8)

$

63.4

$

84.9

$

(421.8)

$

(186.7)

Income tax benefit

-

-

-

-

(7.1)

(7.1)

Interest expense

-

-

-

-

222.1

222.1

Depreciation and amortization

33.5

64.6

48.8

19.3

14.6

180.8

EBITDA

248.1

(63.2)

112.2

104.2

(192.2)

209.1

Share and incentive based compensation

-

-

-

-

53.7

53.7

Restructuring and related charges

4.7

8.1

7.6

1.8

43.5

65.7

Transaction related charges

0.9

7.4

2.5

-

11.0

21.8

Loss on Energizer investment

-

-

-

-

12.1

12.1

Write-off from impairment of goodwill

-

116.0

-

-

-

116.0

Write-off from impairment of intangible assets

-

18.8

16.6

-

-

35.4

Foreign currency loss on multicurrency divestiture loans

-

-

-

-

36.2

36.2

Legal and environmental remediation reserves

-

-

-

-

10.0

10.0

GPC safety recall

-

-

0.7

-

-

0.7

Salus

-

-

-

-

1.6

1.6

Other

-

0.1

3.0

(0.5)

2.1

4.7

Adjusted EBITDA

$

253.7

$

87.2

$

142.6

$

105.5

$

(22.0)

$

567.0

Net Sales

$

1,355.7

$

1,068.1

$

870.2

$

508.1

$

-

$

3,802.1

Adjusted EBITDA Margin

18.7%

8.2%

16.4%

20.8%

-

14.9%

21

SPECTRUM BRANDS HOLDINGS, INC.

PROFORMA ADJUSTED EBITDA - COMPENSATION PROGRAM CHANGE

During the fourth quarter ended September 30, 2020, the Company made a change to its annual management incentive plans ("MIP") payout that previously provided for the issuance of stock for a designated pool of recipients in lieu of cash. The annual MIP payout will instead be fully funded through cash distributions with no stock issuance. Our operating performance metric of Adjusted EBITDA excludes any consideration for stock-based compensation expense. Due to the change in the form of payout, there was a reduction to our stock-based compensation and adjusted EBITDA for the three month and fiscal year ended September 30, 2020 of $17.0 million. For comparative purposes for the three month period and year ended September 30, 2020 respective of the prior period, we have included the following pro forma adjusted EBITDA results for the fiscal fourth quarter and year ended September 30, 2020. The following table reflects the pro forma compensation program change as if the $17.0 million was paid in stock and excluded from Adjusted EBITDA consistent to the prior period.

Three Month Period Ended September 30, 2020 (in millions)

HHI

HPC

GPC

H&G

Corporate

Consolidated

Adjusted EBITDA

$

100.4

$

22.7

$

49.9

$

31.5

$

(31.2)

$

173.3

Proforma compensation program change

-

-

-

-

17.0

17.0

Proforma Adjusted EBITDA

$

100.4

$

22.7

$

49.9

$

31.5

$

(14.2)

$

190.3

Twelve Month Period Ended September 30, 2020 (in millions, except %)

HHI

HPC

GPC

H&G

Corporate

Consolidated

Adjusted EBITDA

$

256.3

$

92.2

$

172.0

$

112.1

$

(52.4)

$

580.2

Proforma compensation program change

-

-

-

-

17.0

17.0

Proforma Adjusted EBITDA

$

256.3

$

92.2

$

172.0

$

112.1

$

(35.4)

$

597.2

The Company has historically recognized all stock based compensation as a corporate cost and continued to do so for purposes of reporting adjusted EBITDA within the consolidated group. With the compensation program change described above, the Company maintained the compensation expense as a component of Corporate within the quarter and did not reflect the incremental change in the Segment EBITDA above.

22

SPECTRUM BRANDS HOLDINGS, INC.

RECONCILIATION OF CASH FLOW FROM OPERATING ACTIVITIES TO ADJUSTED FREE CASH FLOW

The following is a reconciliation of net cash flow from operating activities to adjusted free cash flow for the year ended September 30, 2020 and forecasted for the year ending September 30, 2021.

(in millions)

September 30, 2020

September 30, 2021

Net cash flow from operating activities

$

290

$

310

-

330

Purchases of property, plant and equipment

(61)

(85) -

(95)

Divestiture related separation costs and taxes

25

25

- 35

Adjusted free cash flow

$

254

$

250 -

270

Note: Earnings Framework as of November 13, 2020

23

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Spectrum Brands Holdings Inc. published this content on 13 January 2021 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 20 January 2021 15:45:04 UTC