On Nov. 14, global consumer-products supplier Spectrum Brands (NYSE:SPC) released full-year earnings for its fiscal year 2006, which ended Sept. 30.

  • In the fourth quarter, Spectrum took a $433 million charge (and added $8.05 of operational costs per share on a GAAP basis) for re-evaluating its goodwill balances. The writedown was described as "related to the value of certain trade names and goodwill carried on the company's books."

  • Excluding that charge, net profits got cut at the ankles despite a healthy revenue increase. The culprit was weak battery sales in Europe and North America, on top of a hefty $56 million charge to account for the European restructuring program.

  • See the fiscal Q4 numbers here.

  • Spectrum Brands is a two-star CAPS stock with a very light following. Add your insights on the company here.

(Figures in millions, except per-share data)

Income Statement Highlights

Avg. Est.

FY 2006

FY 2005

Change

Sales

$2,543

$2,551.8

$2,307.2

10.6%

Net Profit

--

$4.5

$41.3

(89.1%)

EPS

$0.50

$0.09

$0.91

(90.1%)

Diluted Shares

 --

49.5

45.6

8.6%

Net results exclude a $433 million asset-impairment charge.

Get back to basics with a look at the income statement.

Margin Checkup

FY 2006

FY 2005

Change*

Gross Margin

38.24%

38.15%

0.09

Operating Margin

5.87%

8.50%

(2.63)

Net Margin

0.18%

1.79%

(1.61)

*Expressed in percentage points.

Net and operating results exclude a $433 million goodwill writedown charge.

Margins are the earnings engine. See how they work.

Balance Sheet Highlights

Assets

FY 2006

FY 2005

Change

Cash + ST Invest.

$28.4

$29.9

(4.9%)

Accounts Rec.

$329.3

$362.4

(9.1%)

Inventory

$460.7

$451.6

2.0%


Liabilities

FY 2006

FY 2005

Change

Total Debt

$2,277.2

$2,307.3

(1.3%)



Learn the ways of the balance sheet.

Cash Flow Highlights

Management did not provide a proper cash flow sheet. Foiled again!

Find out why Fools always follow the money.

Inventory Management Checkup

FY 2006

FY 2005

Change

Days in Inventory

105.6

91.6

14.0

Days in Receivables

49.5

50.0

(0.6)



Read up on cash conversion metrics.

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At the time of publication, Fool contributorAnders Bylund had no position in any company mentioned.