In August 2001, the FASB issued Statement No. 143, Accounting
for Asset Retirement Obligations.Statement No. 143 addresses
financial accounting and reporting for obligations associated
with the retirement of tangible long-lived assets and the asso-
ciated asset retirement costs. The Company is required to
adopt no later than its fiscal year beginning October 1, 2002.
Management is currently evaluating the impact of adoption on
the consolidated financial statements.
In October 2001, the FASB Issued Statement No. 144,
Accounting for the Impairment or Disposal of Long-Lived Assets.
This statement supersedes FASB Statement No. 121, Account-
ing for the Impairment of Long-Lived Assets and for Long-Lived
Assets to be Disposed of,and the accounting and reporting
provisions of APB Opinion No. 30, Reporting the Results of
Operations—Reporting the Effects of Disposal of a Segment of a
Business, and Extraordinary, Unusual and Infrequently Occurring
Events and Transactions,for the disposal of a segment of a
business. The Company is required to adopt no later than its
fiscal year beginning October 1, 2002. Management is cur-
rently evaluating the impact of adoption on the consolidated
financial statements.
(3) Inventories
Inventories consist of the following:
September 30,
2000
2001
Raw material
$31,355
$ 24,271
Work-in-process
11,650
14,015
Finished goods
57,671
53,025
$100,676
$ 91,311
(4) Property,Plant and Equipment
Property, plant and equipment consist of the following:
September 30,
2000
2001
Land, building and improvements
$37,638
$ 34,350
Machinery, equipment and other
168,068
175,724
Construction in process
23,159
11,271
228,865
221,345
Less accumulated depreciation
116,968
114,088
$111,897
$107,257
Machinery, equipment and other includes capitalized leases,
net of amortization, totaling $1,283 and $1,242 at September
30, 2000 and 2001, respectively.
(5) Intangible Assets
Intangible assets consist of the following:
September 30,
2000
2001
Excess cost over fair value of
assets acquired (goodwill)
$33,878
$ 33,878
Trade name
90,000
90,000
Non-competition agreement
730
700
Underfunded pension
2,660
3,081
Proprietary technology
525
525
127,793
128,184
Less: Accumulated amortization
5,679
9,110
$122,114
$119,074
(6) Debt
Debt consists of the following:
September 30,
2000
2001
Revolving credit facility
$175,700
$213,200
Term loan facility
62,830
34,365
Series B Senior Subordinated Notes,
due November 1, 2006, with interest
at 101/4% payable semi-annually
65,000
239
Capitalized lease obligations
1,019
1,098
Notes and obligations, weighted-
average interest rate of 4.90% at
September 30, 2001
13,081
9,075
317,630
257,977
Less current maturities
44,815
24,436
Long-term debt
$272,815
$233,541
In 1999, the Company entered into an Amended and Restated
Credit Agreement (“Second Restated Agreement”). The
Second Restated Agreement provides for senior bank facilities,
including term and revolving credit facilities in an aggregate
amount of $325,000. Interest on borrowings is computed, at
the Company’s option, based on the base rate, as defined
(“Base Rate”), or the Interbank Offering Rate (“IBOR”). The
Notes to Consolidated Financial Statements
Rayovac Corporation and Subsidiaries
(In thousands, except per share amounts)