Q3 2012 Earnings Call
Presentation
October 26, 2012
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Forward-looking statement
Statements in this presentation that are not historical in nature constitute forward-looking statements. These forward-looking statements
relate to information or assumptions about the effects of sales, income/(loss), earnings per share, operating income, operating or gross
margin improvements or declines, Project Renewal, the European Transformation Plan, capital and other expenditures, cash flow,
dividends, restructuring and restructuring-related costs, costs and cost savings, inflation or deflation, particularly with respect to
commodities such as oil and resin, debt ratings, and management's plans, projections and objectives for future operations and
performance. These statements are accompanied by words such as "anticipate," "expect," "project," "will," "believe," "estimate" and
similar expressions. Actual results could differ materially from those expressed or implied in the forward-looking statements. Important
factors that could cause actual results to differ materially from those suggested by the forward-looking statements include, but are not
limited to, our dependence on the strength of retail, commercial and industrial sectors of the economy in light of the continuation or
escalation of the global economic slowdown or regional sovereign debt issues; currency fluctuations; competition with other
manufacturers and distributors of consumer products; major retailers' strong bargaining power; changes in the prices of raw materials
and sourced products and our ability to obtain raw materials and sourced products in a timely manner from suppliers; our ability to
develop innovative new products and to develop, maintain and strengthen our end-user brands; our ability to expeditiously close facilities
and move operations while managing foreign regulations and other impediments; our ability to implement successfully information
technology solutions throughout our organization; our ability to improve productivity and streamline operations; changes to our credit
ratings; significant increases in the funding obligations related to our pension plans due to declining asset values, declining interest rates
or otherwise; the imposition of tax liabilities greater than our provisions for such matters; the risks inherent in our foreign operations and
those factors listed in the company’s latest quarterly report on Form 10-Q and Exhibit 99.1 thereto filed with the Securities and Exchange
Commission. Changes in such assumptions or factors could produce significantly different results. The information contained in this
presentation is as of the date indicated. The company assumes no obligation to update any forward-looking statements contained in this
presentation as a result of new information or future events or developments. This presentation contains non-GAAP financial measures
within the meaning of Regulation G promulgated by the Securities and Exchange Commission. Included in this presentation is a
reconciliation of these non-GAAP financial measures to the most directly comparable financial measures calculated in accordance with
GAAP.
INVESTOR RELATIONS CONTACTS: Nancy O’Donnell Alisha Pennix
VP, Investor Relations Sr. Manager, Investor Relations
(770) 418-7723 (770) 418-7706
nancy.odonnell@newellco.com alisha.pennix@newellco.com
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Q3 2012 summary
 Net Sales of $1.54 billion, 0.9% below prior year, reflecting 1.5% core sales
growth and 2.4% unfavorable foreign currency impact
 Gross Margin up 50 basis points versus prior year to 37.9% as pricing and
productivity more than offset the negative impact of input cost inflation
 Normalized Operating Margin of 13.7%, flat to last year, as gross margin
expansion was offset by an increase in SG&A expense attributable to the
absence of certain prior year compensation-related benefits
 Normalized EPS of $0.47, as compared with $0.45 in the prior year
 Operating cash flow of $305.1 million, versus $295.3 million last year
 The company increased the quarterly dividend by 50% to $0.15 a share
 The company repurchased 1.5 million shares at a cost of $25.9 million
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Q3 YTD 2012 summary
 Net Sales of $4.38 billion, a 0.3% increase versus prior year, reflecting a
2.2% core sales growth and 1.9% unfavorable foreign currency impact
 Gross Margin up 50 basis points versus prior year to 38.2% as productivity
gains and pricing more than offset the effect of input cost inflation
 Normalized Operating Margin up 20 basis points versus prior year to 12.9%
 Normalized EPS of $1.27, as compared with $1.19 in the prior year
 Operating cash flow of $357.2 million, versus $279.8 million last year
 The company repurchased 3.8 million shares at a cost of $67.2 million
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Q3 2012: sales percent change by segment
Baby & Total
Consumer Professional Parenting Net
Q3 2012 Essentials Sales
Core Sales (0.4) 2.5 7.8 1.5
Currency Translation (1.7) (3.6) (2.6) (2.4)
Net Sales (2.1) (1.1) 5.2 (0.9)
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Q3 YTD 2012: sales percent change by segment
Baby & Total
Consumer Professional Parenting Net
Q3 YTD 2012 Essentials Sales
Core Sales (1.2) 4.3 11.2 2.2
Currency Translation (1.4) (2.6) (1.6) (1.9)
Net Sales (2.6) 1.7 9.6 0.3
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FY 2012 outlook
FY 2012 Outlook*
Core Sales 2% to 3%
Currency Translation -1.5% to -2%
Net Sales Growth 0% to 1.5%
“Normalized” Operating Margin Up to +20 basis points
“Normalized” EPS** $1.63 to $1.69
Cash Flow from Operations $550 to $600 million
Capital Expenditures $200 to $225 million
* Reflects outlook communicated in the October 26, 2012 Q3 2012 Earnings Release and Earnings Call
** See reconciliation included in the Appendix
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Expansion of Project Renewal
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Expansion of Project Renewal
 Expansion of Project Renewal is expected to generate incremental annualized
cost savings of $180 to $225 million when fully implemented by the end of the
second quarter of 2015
 Expect to incur incremental cash costs of $225 to $250 million and record pretax
restructuring charges of $250 to $275 million over the same period
 Majority of savings reinvested to drive faster growth and geographic expansion
in priority emerging markets
 Cumulative costs of the expanded Project Renewal are now expected to be $340
to $375 million pretax, with cash costs of $300 to $340 million
 Project Renewal in total is expected to generate annualized costs savings of $270
to $325 million by the end of the second quarter of 2015
 The company is on track to realize annualized cost savings from first phase of
Project Renewal of $90 to $100 million by the first half of 2013
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Project Renewal: Five new work streams
Organizational Simplification
EMEA Transformation
Best Cost Finance
Best Cost Back Office
Supply Chain Footprint
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Project Renewal: Expected outcomes
 Flatter and simplified organization with strengthened Brand and Category
Development and Execution and Delivery capabilities
 Accelerated release of costs, the majority of which will be invested in
faster growth and the geographic expansion of our leading brands
 A greater line of sight to earnings and operating cash flow growth while
the company invests to accelerate performance
 Strengthened leadership team that can drive faster implementation of
Growth Game Plan
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New Organizational Model
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Growth Game Plan
AMBITION
PURPOSE
Newell Rubbermaid helps people flourish every day,
where they live, learn, work and play
CT&A, IP&S, LABELING,
NWL is a growing brand-led business with a strong home in the United WIN COMMERCIAL PRODUCTS
States and global ambition
BIGGER FINE WRITING
BUSINESS MODEL
WHERE TO PLAY
Our Consumer brands win at the point of decision through excellence in WRITING & CREATIVE EXPRESSION
performance, design and innovation
Our Professional brands win the loyalty of the chooser by improving the WIN HOME ORGANIZATION & STYLE
productivity and performance of the user WHERE CULINARY LIFESTYLES
WE ARE HARDWARE
We collaborate with our supplier and customer partners across the total
enterprise in a shared commitment to growth and creating value
INCUBATE BABY & PARENTING
We deliver competitive returns to our shareholders through consistent, FOR ENDICIA, MIMIO
sustainable and profitable growth GROWTH RUBBERMAID MEDICAL SOLUTIONS
MAKE OUR BRANDS BUILD AN EXECUTION UNLOCK TRAPPED DEVELOP THE TEAM EXTEND BEYOND
REALLY MATTER POWERHOUSE CAPACITY FOR GROWTH FOR GROWTH OUR BORDERS
Sharpen brand Launch new USA Deliver European Drive performance Accelerate Latin America
5 WAYS TO WIN
strategies on highest customer development Transformation, Project culture aligned to and Asia in Win Bigger
impact growth levers organization Renewal savings, and business strategy Categories.
working capital reduction
Partner to win with Develop joint business Simplify everything to Build a more global Strategic insight
customers and suppliers plans for new channel release costs for perspective and program in China
penetration and growth talent base
broader distribution
EDGE: EVERY DAY GREAT EXECUTION
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5 Ways to Win shape activities
Make brands really matter
Build an execution powerhouse
Unlock trapped capacity for growth
Extend our boundaries
Develop a growth team
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Two capabilities of equal stature
Interdependent and Equal in Importance
Development Delivery
Marketing & Insight General Management
Advertising Customer Development
R&D Planning
Industrial Design Procurement
e-Branding Building Manufacturing
Public Relations Customer Service
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Structure follows Strategy
 Create new Development Organization accountable for building big brand
ideas, high-impact disruptive innovation, and a true point of difference
through superior design and product experience
 Create new Delivery Organization accountable for P&L management and
delivering the maximum commercial value from the growth ideas built by
the Development Organization
 Create much flatter structures giving bigger roles to key leaders while
driving simplification in order to focus on growth
 Delayer top structures eliminating two operating Groups (Consumer and
Professional) and further consolidating Global Business Units from 9 to 6
reporting Business Segments
 New Business Segments are part of Delivery Organization
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Six new Business Segments
Tools
Commercial Products
Writing
Baby & Parenting
Home Solutions
Specialty
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New Newell Executive Team
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Key appointments
 30 years of management and
William A. Burke III marketing experience (10 years NWL,
Chief Operating Officer
20 years Black & Decker)
 Previously President – Newell
Professional Group and President of
Lenox
 Accelerated international expansion
in the Professional businesses
 Repositioned the Lenox brand to
deliver double-digit sales growth
 Businesses under his leadership have
been the most significant growth
contributors over the last few years
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Key appointments
 Former head of Global Corporate
Mark Tarchetti Strategy at Unilever reporting to the
Chief Development Officer
Global Chief Executive Officer
 Founder of international consulting
firm Tarchetti & Co. Ltd.
 Drove development of Growth Game
Plan with top executive team
 Served in variety of senior strategy,
business and finance roles at Unilever
for 14 years
 Originally from United Kingdom
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Key appointments
 25 years of experience at Newell
Doug Martin Rubbermaid in virtually every aspect
Chief Financial Officer
of corporate and operating finance
 Recently appointed to serve as CFO
and coordinate all of the company’s
cost and cash initiatives to unlock the
trapped capacity for growth
 As Deputy CFO, designed roadmap for
streamlining the company’s cost
structure
 Previously Vice President of Finance –
Newell Consumer Group; Vice
President of Finance – Office
Products; and Treasurer
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Key appointments
 Over 28 years of human resources
Jim Sweet management experience with diverse
Chief Human Resources Officer
global companies
 Provided strong change management
leadership and business partnering to
the company’s leadership
 Former President and Co-Founder of
Capital H Inc., a human resource
services company
 Held top-level human resource roles
with the Kohler Co., Keystone
International and the Brady
Corporation
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Key appointments
 Broad legal and business background
John Stipancich including experience in private equity
Chief Legal Officer & EMEA Lead
 Recently assumed responsibility for
the European Team managing the
company’s results in EMEA in addition
to role as Chief Legal Officer and
General Counsel
 Previously Executive Vice President
and General Counsel of Evenflo, a
former Kohlberg Kravis Roberts & Co.
portfolio company
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Key appointments
 Over 28 years of customer
Joe Cavaliere development experience (8 years
Global Chief Customer Officer Unilever, 20 years Kraft Foods)
 Led customer development for
Unilever’s $11 billion North American
business
 Responsible for catapulting Unilever
to top 5 placement in the U.S.
consumer goods industry as
measured by Kantar
 Responsible for transforming
customer development capabilities at
Kraft and Unilever
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Key appointments
 Successfully built global design and
Chuck Jones development teams that deliver high-
Chief Design and R&D Officer
impact innovations at Whirlpool,
Masco, Xerox and Herman Miller
 Winner of prestigious Smithsonian
National Design Award; named a
Master of Design by Fast Company
 Elected to the Academy of Fellows of
the World Technology Network and
the Academy of Fellows of the
International Design Society
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Key appointments
Richard Davies  Over 30 years of marketing, insights
Chief Marketing & Insights Officer and brand strategy experience
 Built and led Unilever’s Global
Insights function of more than 700
people in over 50 countries
 Proven track record of creating
brands and bringing innovation to
consumers
 Lived and worked in Taiwan, Korea,
Japan, UK
 Originally from New Zealand
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Key appointments
 Over 20 years of senior management
Gordon Steele experience in information technology
Chief Information Officer
 Previously Vice President and CIO for
Global Information Technology at
Nike, where he led the successful
implementation of SAP on a global
basis
 Also served in leadership capacities
with Mentor Graphics Corporation,
Warwick Financial Systems, US
Bancorp and Fred Meyer Savings &
Loan
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Appendix
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Reconciliation: Q3 2012 and
Q3 2011 “Normalized” EPS
Q3 2012* Q3 2011*
Diluted earnings per share (as reported): $0.37 ($0.61)
Impairment charges $0.00 $1.05
Restructuring and restructuring-related costs $0.06 $0.06
Discontinued operations ($0.01) $0.04
CEO transition costs $0.00 $0.01
Income tax - discrete contingencies, expiration of
statutes of limitation and resolution of examinations $0.03 ($0.10)
Loss related to the extinguishment of debt $0.01 $0.00
Other items $0.00 ($0.01)
"Normalized" EPS $0.47 $0.45
* totals may not add due to rounding
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Reconciliation: Q3 YTD 2012 and
Q3 YTD 2011 “Normalized” EPS
Q3 YTD 2012 Q3 YTD 2011*
Diluted earnings per share (as reported): $1.02 $0.15
Impairment charges $0.00 $1.03
Restructuring and restructuring-related costs $0.18 $0.12
Discontinued operations ($0.01) $0.03
CEO transition costs $0.00 $0.01
Income tax - discrete contingencies, expiration of
statutes of limitation and resolution of examinations $0.07 ($0.17)
Loss related to the extinguishment of debt $0.01 $0.01
"Normalized" EPS $1.27 $1.19
* totals may not add due to rounding
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Reconciliation: Full Year 2012
Outlook for “Normalized” EPS
FY 2012
Diluted earnings per share $1.27 to $1.33
Restructuring and restructuring-related costs [ 1 ] $0.27 to $0.32
Discontinued operations ($0.01)
Income tax - discrete contingencies, expiration of statutes of
limitation and resolution of examinations $0.07
Loss related to the extinguishment of debt $0.01
"Normalized" EPS $1.63 to $1.69
[ 1 ] Restructuring and restructuring-related costs include impairment charges, employee
termination benefits and other costs associated with the European Transformation Plan and
Project Renewal.
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Reconciliation: Q3 2012 and Q3 2011 Operating Income,
As Reported, to Normalized Operating Income
$ millions
Q3 2012 Q3 2011
Net sales $1,535.3 $1,549.9
Operating income (as reported) $188.4 ($192.2)
CEO transition costs $- $4.4
Impairment charges $- $382.6
Restructuring and restructuring-related costs $22.3 $17.0
Operating income (normalized) $210.7 $211.8
Operating margin (normalized) 13.7% 13.7%
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Reconciliation: Q3 YTD 2012 and Q3 YTD 2011 Operating
Income, As Reported, to Normalized Operating Income
$ millions
Q3 YTD 2012 Q3 YTD 2011
Net sales $4,383.9 $4,369.4
Operating income (as reported) $498.1 $131.7
CEO transition costs $- $4.4
Impairment charges $- $382.6
Restructuring and restructuring-related costs $66.6 $38.1
Operating income (normalized) $564.7 $556.8
Operating margin (normalized) 12.9% 12.7%
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