Fortune Brands Q3 earnings fall 28.8% to $0.42
Updated full-year EPS before charges/gains guidance is $3.20 to $3.30; targeted businesses have combined annualized operating losses of approximately $50 million to $55 million.
Sentiment and the balance of points
Rhea-AI Sentiment reads the wording of the document, how positive or negative its language is on a 1 to 5 scale. The balance of points shown with the takes weighs what the document actually discloses, so the two can disagree, for example when a trial that missed its main goal is described in upbeat language.
Rhea-AI Filing Summary
Fortune Brands Innovations (FBIN) reported third-quarter 2026 sales of $1.1137 billion, down 3.1% versus Q3 2025. GAAP diluted EPS was $0.42, down 28.8%, including a $0.47-per-share asset impairment charge. EPS before charges/gains was $1.14, up 4.6%, and included a $0.28 net tax benefit and $0.14 of net tariff refunds.
Fortune Brands updated full-year 2026 guidance to net sales of $4.205 billion to $4.275 billion and EPS before charges/gains of $3.20 to $3.30. Third-quarter operating cash flow was $347.0 million and free cash flow was $331.1 million; net debt was $2.1 billion and net debt-to-EBITDA before charges/gains was 2.5x.
Portfolio actions include a definitive agreement to sell Fiberon for $160 million, subject to the agreement’s terms and conditions; exiting the Moen commercial business serving domestic markets in Asia while continuing supply-chain operations in China; and rationalizing the EMEA operating footprint of a Water segment business. Together, the targeted businesses generate annualized operating losses of approximately $50 million to $55 million on revenue of $320 million to $330 million. The China and EMEA actions are expected to be completed by the third and fourth quarters of 2027, respectively.
How this balance works
Rhea-AI gives every point it takes from this document a weight. Minor counts 1, Moderate 3 and Major 9, so one Major point outweighs several Minor ones. The bar adds up the weights on each side, and when neither side holds more than 65% of the total the balance reads Mixed.
It reads the document as published, with the same rules for every company, and it does not look at what the market expected or at how the stock traded, so a point can be objectively good on a day the stock falls.
Rhea-AI Sentiment measures something else, the tone of the wording.
Positive
- Moderate pointNine-month operating cash flow increased to $430.6 million from $270.4 million.
Negative
- Moderate pointQ3 GAAP diluted EPS fell 28.8% to $0.42.
Filing Explained
The release estimates a further noncash impairment charge of
8-K Event Classification
Key Figures
Key Terms
EPS before charges / gains financial
net debt-to-EBITDA before charges/(gains) ratio financial
free cash flow financial
asset impairment charge financial
Earnings Snapshot
Full-year 2026 net sales of $4.205 billion to $4.275 billion and EPS before charges/gains of $3.20 to $3.30; operating cash flow of $480 million to $500 million and free cash flow of $380 million to $410 million.
FAQ
AI-generated questions and answers. How Rhea-AI works. Not financial advice.
What were FBIN’s Q3 2026 sales and earnings?
What is FBIN’s full-year 2026 guidance?
What are the terms of FBIN’s Fiberon sale agreement?
What is FBIN changing in its China business?
What additional Fiberon impairment charge does FBIN estimate?
AI-generated analysis. How Rhea-AI works. Not financial advice.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): |
(Exact name of Registrant as Specified in Its Charter)
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(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
Securities registered pursuant to Section 12(b) of the Act:
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item 2.02 Results of Operations and Financial Condition.
On November 3, 2026, Fortune Brands Innovations, Inc. (the “Company”) issued a press release reporting the Company’s third quarter 2026 results, as well as certain guidance for 2026. A copy of the Company’s press release is being furnished as Exhibit 99.1 to this Current Report on Form 8-K and is hereby incorporated herein by reference.
The information furnished pursuant to this Item 2.02, including Exhibit 99.1, shall not be deemed to be “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”) or otherwise subject to the liabilities under that section and shall not be deemed to be incorporated by reference into any filing of the Company under the Securities Act of 1933 or the Exchange Act.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits
Exhibit No. |
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Description |
99.1 |
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Press Release dated November 3, 2026, issued by Fortune Brands Innovations, Inc. |
104 |
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Cover Page Interactive Data File (embedded within the Inline XBRL document). |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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FORTUNE BRANDS INNOVATIONS, INC. |
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Date: |
November 3, 2026 |
By: |
/s/ Peter G. Clifford |
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Name: Title: |
Peter G. Clifford |
EXHIBIT 99.1
Fortune Brands Announces Third Quarter Results,
Taking Action to Revitalize the Company's Performance
Highlights:
DEERFIELD, Ill.--(BUSINESS WIRE)--November 3, 2026--Fortune Brands Innovations, Inc. (NYSE: FBIN) (“Fortune Brands” or the “Company”), an industry-leading home, security and digital products company, today announced third quarter 2026 results.
“Fortune Brands is in the early stages of a multi-year turnaround plan to get Back to Business. We are building from a strong foundation of brands that consumers and pros know and trust. Third quarter results were in line with our outlook excluding the tax and tariff benefits, but not where they need to be. Our biggest challenge has been our own execution, and we are taking aggressive steps to drive improvement,” said Fortune Brands Chief Executive Officer Jesse Singh.
“Service levels improved 10 percentage points in the third quarter, with fill rates in the high-90% range entering the fourth quarter. We have realigned the organization around customer-focused segments and expect to have more than 80% of our salaried workforce directly supporting a specific business by year end, up from roughly 40% at the start of the year. In addition, we have strengthened the leadership team with a new Chief Financial Officer, Chief Information Officer and Chief Legal Officer, and new leaders within each of our businesses. We remain on track for $70 million of annualized SG&A savings by the first quarter of 2027. We also entered into a purchase agreement to sell Fiberon, are exiting our commercial operations in China, which we expect to be completed by the third quarter of 2027 and are rationalizing the EMEA operating footprint of a business in our Water segment, which we expect to be completed by the fourth quarter of 2027. Together these businesses generate an annualized operating loss of approximately $50 million to $55 million on revenue of $320 million to $330 million.
“In the fourth quarter, we expect incrementally lower revenue, driven by three things: lower sales from the businesses involved in the portfolio optimization actions, incremental softening in single-family new construction, and a reduction in channel inventory. We are using this quarter’s net tax benefit to fund additional portfolio and alignment actions in the fourth quarter. The work ahead is substantial, but the opportunity is large: we have leading brands, customers and channel partners who want to win with us, and a team that is engaged and moving with urgency. I am confident that our actions will build a stronger, simpler and more customer-focused company that delivers consistent growth, margin expansion and shareholder value over the long term.”
1 Net tariff refunds include gross tariff refunds and interest income (for EPS only), partially offset by increases in directly attributable variable incentive compensation costs and taxes (for EPS only)
Third Quarter 2026 Results
($ in millions, except per share amounts)
Unaudited
Q3 2026 Total Company Results
|
Reported Net Sales |
Operating Income/(Loss) |
Operating Margin |
EPS |
Q3 2026 GAAP |
$1,113.7 |
$60.4 |
5.4% |
$0.42 |
Change |
(3.1%) |
(52.0%) |
(560 bps) |
(28.8%) |
|
Reported Net Sales |
Operating Income/(Loss) Before Charges / Gains |
Operating Margin Before Charges / Gains |
EPS Before Charges / Gains |
Q3 2026 Non-GAAP |
$1,113.7 |
$155.5 |
14.0% |
$1.14 |
Change |
(3.1%) |
(24.6%) |
(390 bps) |
4.6% |
Q3 2026 Segment Results
|
Net Sales |
Change |
Operating Margin |
Change |
Operating Margin Before Charges/Gains |
Change |
Water Innovations2 |
$584.5 |
(5.5%) |
2.3% |
(2,130 bps) |
17.6% |
(680 bps) |
Outdoors2 |
$347.4 |
0.8% |
15.1% |
1,660 bps |
15.3% |
(20 bps) |
Security |
$181.8 |
(2.4)% |
21.1% |
620 bps |
21.3% |
350 bps |
2 Water sales excluding China decreased 4.3% and Outdoors sales excluding Fiberon increased 3.4%
Balance Sheet and Cash Flow
The Company ended the quarter with a strong balance sheet, liquidity of approximately $1.3 billion and net debt to EBITDA before charges and gains of 2.5x. In the quarter, the Company generated $347.0 million in operating cash flow and $331.1 million in free cash flow, while repurchasing $40 million of its shares.
As of the end of the third quarter 2026:
Net debt |
$2.1 billion |
Net debt to EBITDA before charges / gains |
2.5x |
Cash |
$231 million |
Amount available under revolving credit facility |
$1.1 billion |
2026 Full-Year Guidance
“Looking ahead, we see a softer environment for single-family new construction and expect this part of the market to be down mid to high single digits, with R&R down low single digits for the year. Customers are signaling greater caution and we are taking a more conservative approach to channel inventory given the uncertain macroeconomic environment. We have also made important decisions on dilutive parts of our portfolio, which we expect will help improve future profitability. Those businesses will continue to have an impact on our results for the fourth quarter and the first half of next year. With these factors in mind, we are prudently updating our guidance for net sales and EPS before charges / gains. Fourth quarter and full year net sales are expected to be in the range of $925 million to $995 million and $4,205 million to $4,275 million, respectively. Fourth quarter and full year EPS before charges / gains is expected to be in the range of $0.19 to $0.29 and $3.20 to $3.30, respectively. We also expect full year operating cash flow and free cash flow to be in the range of $480 million to $500 million and $380 million to $410 million, respectively," said Fortune Brands Chief Financial Officer Pete Clifford. "While these actions will weigh on our near-term results, they position us to enter 2027 on stronger footing."
Full-Year Guidance Bridge
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EPS Before / Charges Gains |
Mid-Point of Previous Guidance |
$3.37 |
Guidance Updates |
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Impact from Businesses Subject to Portfolio Optimization Actions |
($0.02) |
Impact from Core Business and End Market |
($0.23) |
Portfolio Optimization & Alignment Actions |
($0.22) |
Net Tariff Refunds |
$0.07 |
Net Tax Benefit |
$0.28 |
Mid-Point of Current Guidance |
$3.25 |
For certain forward-looking non-GAAP financial measures (as used in this press release, EPS before charges / gains), the Company is unable to provide a reconciliation to the most comparable GAAP financial measure because the information needed to reconcile the non-GAAP financial measure to the GAAP financial measure is unavailable due to the inherent difficulty of forecasting the timing and / or amount of various items that have not yet occurred, including the high variability and low visibility with respect to gains and losses associated with our defined benefit plans, and restructuring and other charges, which are each excluded from EPS before charges / gains, other than with respect to the Company’s previously-announced estimated additional non-cash impairment charge for the Fiberon asset group of approximately $175 million to $205 million. As a result, the Company is not otherwise able to reasonably estimate the probable significance of such items. Additionally, estimating such GAAP measures and providing a meaningful reconciliation consistent with the Company’s accounting policies for future periods requires a level of precision that is unavailable for these future periods and cannot be accomplished without unreasonable effort. Forward-looking non-GAAP financial measures are estimated consistent with the relevant definitions and assumptions. For a reconciliation of full year 2026 free cash flow guidance to full year 2026 operating cash flow guidance, see the table entitled “Free Cash Flow” below.
Conference Call Details
Today at 5:00 p.m. ET, Fortune Brands will host an investor conference call to discuss results. A live audio webcast of the conference call and a copy of the earnings presentation will be available on the Fortune Brands website at ir.fbin.com/events. It is recommended that listeners log on at least 10 minutes prior to the start of the call. A recorded replay of the call will be made available on the Company’s website shortly after the call has ended.
About Fortune Brands Innovations
Fortune Brands Innovations, Inc. (NYSE: FBIN) is an industry-leading home, security and digital products company. The Company makes innovative, reliable products that contribute to safety, enhance sustainability and provide luxury for residential and commercial customers. The Company’s trusted brands include Moen, House of Rohl, Aqualisa, SpringWell, Therma-Tru, Larson, Fiberon, Master Lock, Sentry Safe and Yale residential. Learn more at www.fbin.com.
CAUTIONARY STATEMENT CONCERNING FORWARD-LOOKING STATEMENTS
This press release contains forward-looking statements that are made pursuant to the safe harbor provisions of Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange Act of 1934, as amended. Forward-looking statements include all statements that are not historical statements of fact and those regarding our intent, belief or expectations for our business, operations, financial performance or financial condition in addition to statements regarding our strategies and investments to enhance execution and realign our business, our expectations for the markets in which we operate, expected impacts from recently-announced organizational and leadership changes, ongoing succession planning, the market potential of our brands, trends in the housing market, the potential impact of costs, including material and labor costs, the other potential impacts of inflation, including consumer spending, expected capital spending, expected pension contributions or de-risking initiatives, the expected impact of acquisitions, dispositions and other strategic transactions, the anticipated impact of recently issued accounting standards on our financial statements, the anticipated impact of future tariff and tariff refunds and other matters that are not historical in nature. Statements preceded by, followed by or that otherwise include the words “believes,” “expects,” “anticipates,” “intends,” “projects,” “estimates,” “plans,” “outlook,” “positioned,” “confident,” “opportunity,” “focus,” "on track" and similar expressions or future or conditional verbs such as “will,” “should,” “would,” “may,” and “could” are generally forward-looking in nature and not historical facts. Where, in any forward-looking statement, we express an expectation or belief as to future results or events, such expectation or belief is based on current expectations, estimates, assumptions and projections of our management about our industry, business and future financial results, available at the time this press release is issued. Although we believe that these statements are based on reasonable assumptions, they are subject to numerous factors, risks and uncertainties that could cause actual outcomes and results to be materially different from those indicated in such statements, including but not limited to: (i) our reliance on the North American and Chinese home improvement, repair and remodel and new home construction activity levels, (ii) the housing market, downward changes in the general economy, unfavorable interest rates or other business conditions, (iii) the competitive nature of consumer and trade brand businesses, (iv) our ability to execute on our strategic plans and the effectiveness of our strategies in the face of business competition, (v) our reliance on key customers and suppliers, including wholesale distributors and dealers and retailers, (vi) risks associated with our recent leadership changes, (vii) risks relating to rapidly evolving technological change, (viii) risks associated with our ability to improve organizational productivity and global supply chain efficiency and flexibility, (ix) risks associated with global commodity and energy availability and price volatility, as well as the possibility of sustained inflation, (x) delays or outages in our information technology systems or computer networks or breaches of our information technology systems or other cybersecurity incidents, (xi) risks associated with doing business globally, including changes in trade-related tariffs (including recent U.S. tariffs announced or imposed on China, Canada, Mexico and other countries and any reciprocal actions taken by such countries) and risks with uncertain trade environments, (xii) risks associated with the disruption of operations, including as a result of severe weather events, (xiii) our inability to obtain raw materials and finished goods in a timely and cost-effective manner, (xiv) risks associated with strategic acquisitions, divestitures and joint ventures, including difficulties integrating acquired companies and the inability to achieve the expected financial results and benefits of transactions, (xv) impairments in the carrying value of goodwill or other acquired intangible assets, (xvi) risks of increases in our defined benefit-related costs and funding requirements, (xvii) our ability to attract and retain qualified personnel and other labor constraints, (xviii) the effect of climate change and the impact of related changes in government regulations and consumer preferences, (xix) risks associated with environmental, social and governance matters, (xx) potential liabilities and costs from claims and litigation, (xxi) changes in government and industry regulatory standards, (xxii) future tax law changes or the interpretation of existing tax laws, and (xxiii) our ability to secure and protect our intellectual property rights. These and other factors are discussed in Part I, Item 1A “Risk Factors” of our Annual Report on Form 10-K for the year ended December 27, 2025. We undertake no obligation to, and expressly disclaim any such obligation to, update, amend, revise or clarify any forward-looking statements to reflect changed assumptions, the occurrence of anticipated or unanticipated events, new information or changes to future results over time or otherwise, except as required by law.
Use of Non-GAAP Financial Information
This press release includes measures not derived in accordance with generally accepted accounting principles (“GAAP”), such as diluted earnings (loss) per share before charges / gains, operating income (loss) before charges / gains, operating margin before charges / gains, net debt, net debt to EBITDA before charges / gains, net sales excluding the impact of China, Outdoors net sales excluding the impact of Fiberon and free cash flow. These non-GAAP financial measures should not be considered in isolation or as a substitute for any measure derived in accordance with GAAP and may also be inconsistent with similar measures presented by other companies. Reconciliations of these measures to the applicable most closely comparable GAAP measures, and reasons for the Company’s use of these measures, are presented in the attached pages.
Source: Fortune Brands Innovations, Inc.
INVESTOR CONTACT:
Curt Worthington
Investor.Questions@fbin.com
FORTUNE BRANDS INNOVATIONS, INC.
(In millions)
(Unaudited)
|
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Thirteen Weeks Ended |
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Thirty-Nine Weeks Ended |
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Net sales (GAAP) |
|
September 26, 2026 |
|
September 27, 2025 |
|
$ Change |
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% Change |
|
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September 26, 2026 |
|
September 27, 2025 |
|
$ Change |
|
% Change |
|
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Water |
|
$ |
584.5 |
|
$ |
618.5 |
|
$ |
(34.0 |
) |
|
(5.5 |
) |
|
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$ |
1,753.1 |
|
$ |
1,830.8 |
|
$ |
(77.7 |
) |
|
(4.2 |
) |
Outdoors |
|
|
347.4 |
|
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344.5 |
|
|
2.9 |
|
|
0.8 |
|
|
|
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1,006.4 |
|
|
1,028.1 |
|
|
(21.7 |
) |
|
(2.1 |
) |
Security |
|
|
181.8 |
|
|
186.2 |
|
|
(4.4 |
) |
|
(2.4 |
) |
|
|
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519.4 |
|
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526.8 |
|
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(7.4 |
) |
|
(1.4 |
) |
Total net sales |
|
$ |
1,113.7 |
|
$ |
1,149.2 |
|
$ |
(35.5 |
) |
|
(3.1 |
) |
|
|
$ |
3,278.9 |
|
$ |
3,385.7 |
|
$ |
(106.8 |
) |
|
(3.2 |
) |
RECONCILIATIONS OF GAAP OPERATING INCOME TO OPERATING INCOME BEFORE CHARGES/(GAINS)
(In millions)
(Unaudited)
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Thirteen Weeks Ended |
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Thirty-Nine Weeks Ended |
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September 26, 2026 |
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September 27, 2025 |
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$ Change |
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% Change |
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September 26, 2026 |
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September 27, 2025 |
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$ Change |
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% Change |
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WATER |
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Operating income (GAAP) |
|
$ |
13.3 |
|
$ |
145.9 |
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$ |
(132.6 |
) |
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(90.9 |
) |
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$ |
292.0 |
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$ |
405.1 |
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$ |
(113.1 |
) |
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(27.9 |
) |
Restructuring charges |
|
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13.1 |
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4.4 |
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8.7 |
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197.7 |
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18.3 |
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20.3 |
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(2.0 |
) |
|
(9.9 |
) |
Other charges/(gains) |
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Cost of products sold |
|
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- |
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0.3 |
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(0.3 |
) |
NM |
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|
- |
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0.8 |
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(0.8 |
) |
NM |
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Selling, general and administrative expenses |
|
|
7.2 |
|
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0.5 |
|
|
6.7 |
|
NM |
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|
7.4 |
|
|
3.7 |
|
|
3.7 |
|
NM |
|
||
Asset impairment charges (h) |
|
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69.5 |
|
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- |
|
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69.5 |
|
NM |
|
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70.1 |
|
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- |
|
|
70.1 |
|
NM |
|
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Operating income before charges/(gains) (a) |
|
$ |
103.1 |
|
$ |
151.1 |
|
$ |
(48.0 |
) |
|
(31.8 |
) |
|
|
$ |
387.8 |
|
$ |
429.9 |
|
$ |
(42.1 |
) |
|
(9.8 |
) |
|
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OUTDOORS |
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Operating (loss) income (GAAP) |
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$ |
52.3 |
|
$ |
(5.0 |
) |
$ |
57.3 |
|
|
1,146.0 |
|
|
|
$ |
(107.7 |
) |
$ |
59.7 |
|
$ |
(167.4 |
) |
|
(280.4 |
) |
Restructuring charges |
|
|
0.9 |
|
|
0.3 |
|
|
0.6 |
|
NM |
|
|
|
|
1.8 |
|
|
4.9 |
|
|
(3.1 |
) |
|
(63.3 |
) |
|
Other charges/(gains) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Cost of products sold |
|
|
0.5 |
|
|
3.0 |
|
|
(2.5 |
) |
|
(83.3 |
) |
|
|
|
1.6 |
|
|
8.8 |
|
|
(7.2 |
) |
|
(81.8 |
) |
Selling, general and administrative expenses |
|
|
- |
|
|
2.0 |
|
|
(2.0 |
) |
NM |
|
|
|
|
0.1 |
|
|
7.2 |
|
|
(7.1 |
) |
|
(98.6 |
) |
|
Asset impairment charges (h) |
|
|
4.3 |
|
|
50.1 |
|
|
(45.8 |
) |
|
(91.5 |
) |
|
|
|
233.0 |
|
|
50.1 |
|
|
182.9 |
|
NM |
|
|
Manufacturing facility fire (i) |
|
|
(4.7 |
) |
|
3.0 |
|
|
(7.7 |
) |
NM |
|
|
|
|
1.9 |
|
|
3.0 |
|
|
(1.1 |
) |
|
(36.7 |
) |
|
Operating income before charges/(gains) (a) |
|
$ |
53.3 |
|
$ |
53.4 |
|
$ |
(0.1 |
) |
|
(0.3 |
) |
|
|
$ |
130.7 |
|
$ |
133.7 |
|
$ |
(3.0 |
) |
|
(2.2 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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||||||||
SECURITY |
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||||||||
Operating income (GAAP) |
|
$ |
38.4 |
|
$ |
27.7 |
|
$ |
10.7 |
|
|
38.6 |
|
|
|
$ |
109.1 |
|
$ |
66.4 |
|
$ |
42.7 |
|
|
64.3 |
|
Restructuring charges |
|
|
0.4 |
|
|
1.7 |
|
|
(1.3 |
) |
|
(76.5 |
) |
|
|
|
1.0 |
|
|
7.4 |
|
|
(6.4 |
) |
|
(86.5 |
) |
Other charges/(gains) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Cost of products sold |
|
|
- |
|
|
0.1 |
|
|
(0.1 |
) |
NM |
|
|
|
|
- |
|
|
3.8 |
|
|
(3.8 |
) |
NM |
|
||
Selling, general and administrative expenses |
|
|
- |
|
|
3.7 |
|
|
(3.7 |
) |
NM |
|
|
|
|
(0.2 |
) |
|
5.1 |
|
|
(5.3 |
) |
NM |
|
||
Operating income before charges/(gains) (a) |
|
$ |
38.8 |
|
$ |
33.2 |
|
$ |
5.6 |
|
|
16.9 |
|
|
|
$ |
109.9 |
|
$ |
82.7 |
|
$ |
27.2 |
|
|
32.9 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
TOTAL COMPANY |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Operating income (loss) (GAAP) |
|
$ |
60.4 |
|
$ |
125.9 |
|
$ |
(65.5 |
) |
|
(52.0 |
) |
|
|
$ |
111.7 |
|
$ |
394.4 |
|
$ |
(282.7 |
) |
|
(71.7 |
) |
Restructuring charges |
|
|
16.4 |
|
|
10.8 |
|
|
5.6 |
|
|
51.9 |
|
|
|
|
28.9 |
|
|
49.3 |
|
|
(20.4 |
) |
|
(41.4 |
) |
Other charges/(gains) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Cost of products sold |
|
|
0.5 |
|
|
3.4 |
|
|
(2.9 |
) |
|
(85.3 |
) |
|
|
|
1.6 |
|
|
13.4 |
|
|
(11.8 |
) |
|
(88.1 |
) |
Selling, general and administrative expenses |
|
|
8.6 |
|
|
12.3 |
|
|
(3.7 |
) |
|
(30.1 |
) |
|
|
|
12.1 |
|
|
27.8 |
|
|
(15.7 |
) |
|
(56.5 |
) |
Asset impairment charges (h) |
|
|
73.8 |
|
|
50.1 |
|
|
23.7 |
|
|
47.2 |
|
|
|
|
303.1 |
|
|
50.1 |
|
|
253.0 |
|
NM |
|
|
Manufacturing facility fire (i) |
|
|
(4.7 |
) |
|
3.0 |
|
|
(7.7 |
) |
NM |
|
|
|
|
1.9 |
|
|
3.0 |
|
|
(1.1 |
) |
|
(36.7 |
) |
|
Transformation costs (j) |
|
|
- |
|
|
0.7 |
|
|
(0.7 |
) |
NM |
|
|
|
|
- |
|
|
3.0 |
|
|
(3.0 |
) |
NM |
|
||
Governance advisory services and leadership transitions (k) |
|
|
0.5 |
|
|
- |
|
|
0.5 |
|
NM |
|
|
|
|
44.2 |
|
|
- |
|
|
44.2 |
|
NM |
|
||
Operating income before charges/(gains) (a) |
|
$ |
155.5 |
|
$ |
206.2 |
|
$ |
(50.7 |
) |
|
(24.6 |
) |
|
|
$ |
503.5 |
|
$ |
541.0 |
|
$ |
(37.5 |
) |
|
(6.9 |
) |
(a) (h) (i) (j) (k) For definitions of Non-GAAP financial measures, see Definitions of Terms: Non-GAAP Financial Measures page
NM = Not meaningful
FORTUNE BRANDS INNOVATIONS, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS (GAAP)
(In millions)
(Unaudited)
|
September 26, 2026 |
|
|
December 27, 2025 |
|
||
|
|
|
|
|
|
||
Assets |
|
|
|
|
|
||
Current assets |
|
|
|
|
|
||
Cash and cash equivalents |
$ |
230.9 |
|
|
$ |
264.0 |
|
Accounts receivable, net |
|
551.2 |
|
|
|
513.1 |
|
Inventories |
|
1,013.8 |
|
|
|
1,024.9 |
|
Other current assets |
|
164.0 |
|
|
|
172.2 |
|
Total current assets |
|
1,959.9 |
|
|
|
1,974.2 |
|
|
|
|
|
|
|
||
Property, plant and equipment, net |
|
582.9 |
|
|
|
805.9 |
|
Goodwill |
|
2,002.0 |
|
|
|
2,006.4 |
|
Other intangible assets, net of accumulated amortization |
|
1,071.9 |
|
|
|
1,231.7 |
|
Assets held for sale |
|
104.0 |
|
|
|
113.8 |
|
Other assets |
|
413.6 |
|
|
|
388.6 |
|
Total assets |
$ |
6,134.3 |
|
|
$ |
6,520.6 |
|
|
|
|
|
|
|
||
|
|
|
|
|
|
||
Liabilities and equity |
|
|
|
|
|
||
Current liabilities |
|
|
|
|
|
||
Accounts payable |
|
540.9 |
|
|
|
524.6 |
|
Other current liabilities |
|
527.9 |
|
|
|
547.0 |
|
Total current liabilities |
|
1,068.8 |
|
|
|
1,071.6 |
|
|
|
|
|
|
|
||
Long-term debt |
|
2,296.6 |
|
|
|
2,544.9 |
|
Deferred income taxes |
|
110.7 |
|
|
|
146.9 |
|
Other non-current liabilities |
|
368.3 |
|
|
|
368.6 |
|
Total liabilities |
|
3,844.4 |
|
|
|
4,132.0 |
|
|
|
|
|
|
|
||
Stockholders' equity |
|
2,289.9 |
|
|
|
2,388.6 |
|
Total equity |
|
2,289.9 |
|
|
|
2,388.6 |
|
Total liabilities and equity |
$ |
6,134.3 |
|
|
$ |
6,520.6 |
|
FORTUNE BRANDS INNOVATIONS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(In millions)
(Unaudited)
|
|
Thirty-Nine Weeks Ended |
|
||||
|
|
September 26, 2026 |
|
September 27, 2025 |
|
||
Operating activities |
|
|
|
|
|
||
Net income |
|
$ |
51.6 |
|
$ |
222.4 |
|
Depreciation and amortization |
|
|
121.2 |
|
|
151.5 |
|
Non-cash lease expense |
|
|
30.6 |
|
|
31.4 |
|
Deferred taxes |
|
|
(39.9 |
) |
|
33.3 |
|
Asset impairment charge |
|
|
303.1 |
|
|
50.1 |
|
Other non-cash items |
|
|
14.1 |
|
|
19.4 |
|
Changes in assets and liabilities, net |
|
|
(50.1 |
) |
|
(237.7 |
) |
Net cash provided by operating activities |
|
$ |
430.6 |
|
$ |
270.4 |
|
|
|
|
|
|
|
||
Investing activities |
|
|
|
|
|
||
Capital expenditures |
|
$ |
(59.7 |
) |
$ |
(87.3 |
) |
Proceeds from the disposition of assets |
|
|
24.3 |
|
|
- |
|
Other investing activities, net |
|
|
(1.0 |
) |
|
2.9 |
|
Net cash used in investing activities |
|
$ |
(36.4 |
) |
$ |
(84.4 |
) |
|
|
|
|
|
|
||
Financing activities |
|
|
|
|
|
||
Increase in debt, net |
|
$ |
(251.2 |
) |
$ |
(20.0 |
) |
Proceeds from the exercise of stock options |
|
|
8.6 |
|
|
4.0 |
|
Treasury stock purchases |
|
|
(84.4 |
) |
|
(237.8 |
) |
Dividends to stockholders |
|
|
(93.2 |
) |
|
(90.6 |
) |
Other items, net |
|
|
(7.1 |
) |
|
(8.2 |
) |
Net cash used in financing activities |
|
$ |
(427.3 |
) |
$ |
(352.6 |
) |
|
|
|
|
|
|
||
Effect of foreign exchange rate changes on cash |
|
$ |
(0.3 |
) |
$ |
8.6 |
|
|
|
|
|
|
|
||
Net decrease in cash and cash equivalents |
|
$ |
(33.4 |
) |
$ |
(158.0 |
) |
Cash, cash equivalents and restricted cash* at beginning of period |
|
|
267.5 |
|
|
385.5 |
|
Cash, cash equivalents and restricted cash* at end of period |
|
$ |
234.1 |
|
$ |
227.5 |
|
FREE CASH FLOW |
|
Thirty-Nine Weeks Ended |
|
2026 Full Year |
||||
|
|
September 26, 2026 |
|
September 27, 2025 |
|
Estimate |
||
|
|
|
|
|
|
|
||
Cash flow from operations (GAAP) |
|
$ |
430.6 |
|
$ |
270.4 |
|
$480 to $500 |
Less: |
|
|
|
|
|
|
||
Capital expenditures |
|
$ |
59.7 |
|
$ |
87.3 |
|
$90 to $100 |
Free cash flow (b) |
|
$ |
370.9 |
|
$ |
183.1 |
|
$380 to $410 |
|
|
|
|
|
|
|
||
*Restricted cash of $1.2 million and $2.0 million is included in Other current assets and Other assets, respectively, as of September 26, 2026. Restricted cash of $1.3 million and $2.3 million is included in Other current assets and Other assets, respectively, as of September 27, 2025.
(b) For definitions of Non-GAAP financial measures, see Definitions of Terms: Non-GAAP Financial Measures page
FORTUNE BRANDS INNOVATIONS, INC.
RECONCILIATION OF CASH FLOW FROM OPERATIONS (GAAP) TO FREE CASH FLOW
(In millions)
(Unaudited)
|
|
Thirteen Weeks Ended |
|
|
|
|
September 26, 2026 |
|
|
|
|
|
|
|
|
|
|
|
|
Cash flow from operations (GAAP) |
|
$ |
347.0 |
|
Less: |
|
|
|
|
Capital expenditures |
|
|
15.9 |
|
Free cash flow (b) |
|
$ |
331.1 |
|
(b) For definitions of Non-GAAP financial measures, see Definitions of Terms: Non-GAAP Financial Measures page
FORTUNE BRANDS INNOVATIONS, INC.
CONDENSED CONSOLIDATED STATEMENTS OF INCOME (GAAP)
(In millions, except per share amounts)
(Unaudited)
|
Thirteen Weeks Ended |
|
|
|
|
Thirty-Nine Weeks Ended |
|
|
|
||||||||||
|
September 26, 2026 |
|
September 27, 2025 |
|
% Change |
|
|
September 26, 2026 |
|
September 27, 2025 |
|
% Change |
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Net sales |
$ |
1,113.7 |
|
$ |
1,149.2 |
|
|
(3.1 |
) |
|
$ |
3,278.9 |
|
$ |
3,385.7 |
|
|
(3.2 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Cost of products sold |
|
607.7 |
|
|
629.8 |
|
|
(3.5 |
) |
|
|
1,746.5 |
|
|
1,868.5 |
|
|
(6.5 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Selling, general and administrative expenses |
|
339.5 |
|
|
313.2 |
|
|
8.4 |
|
|
|
1,035.9 |
|
|
967.0 |
|
|
7.1 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Amortization of intangible assets |
|
15.9 |
|
|
19.4 |
|
|
(18.0 |
) |
|
|
52.8 |
|
|
56.4 |
|
|
(6.4 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Asset impairment charges |
|
73.8 |
|
|
50.1 |
|
|
47.3 |
|
|
|
303.1 |
|
|
50.1 |
|
|
505.0 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Restructuring charges |
|
16.4 |
|
|
10.8 |
|
|
51.9 |
|
|
|
28.9 |
|
|
49.3 |
|
|
(41.4 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Operating income |
|
60.4 |
|
|
125.9 |
|
|
(52.0 |
) |
|
|
111.7 |
|
|
394.4 |
|
|
(71.7 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Interest expense |
|
24.4 |
|
|
28.6 |
|
|
(14.7 |
) |
|
|
78.3 |
|
|
88.4 |
|
|
(11.4 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Other (income)/expense, net |
|
(4.5 |
) |
|
2.6 |
|
|
(273.1 |
) |
|
|
(3.9 |
) |
|
(5.8 |
) |
|
(32.8 |
) |
Income before taxes |
|
40.5 |
|
|
94.7 |
|
|
(57.2 |
) |
|
|
37.3 |
|
|
311.8 |
|
|
(88.0 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Income tax (benefit) expense |
|
(9.4 |
) |
|
23.9 |
|
|
(139.3 |
) |
|
|
(14.3 |
) |
|
89.4 |
|
|
(116.0 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Net income |
$ |
49.9 |
|
$ |
70.8 |
|
|
(29.5 |
) |
|
$ |
51.6 |
|
$ |
222.4 |
|
|
(76.8 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Diluted earnings (loss) per common share |
$ |
0.42 |
|
$ |
0.59 |
|
|
(28.8 |
) |
|
$ |
0.43 |
|
$ |
1.83 |
|
|
(76.4 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Diluted average number of shares outstanding |
|
119.3 |
|
|
120.5 |
|
|
(1.0 |
) |
|
|
119.6 |
|
|
121.4 |
|
|
(1.5 |
) |
FORTUNE BRANDS INNOVATIONS, INC.
(In millions)
(Unaudited)
RECONCILIATIONS OF NET INCOME TO EBITDA BEFORE CHARGES/(GAINS)
|
Thirteen Weeks Ended |
|
|
|
|
Thirty-Nine Weeks Ended |
|
|
|
||||||||||
|
September 26, 2026 |
|
September 27, 2025 |
|
% Change |
|
|
September 26, 2026 |
|
September 27, 2025 |
|
% Change |
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Net income |
$ |
49.9 |
|
$ |
70.8 |
|
|
(29.5 |
) |
|
$ |
51.6 |
|
$ |
222.4 |
|
|
(76.8 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Depreciation * |
$ |
20.6 |
|
$ |
24.4 |
|
|
(15.6 |
) |
|
$ |
68.3 |
|
$ |
74.1 |
|
|
(7.8 |
) |
Amortization of intangible assets |
|
15.9 |
|
|
19.4 |
|
|
(18.0 |
) |
|
|
52.8 |
|
|
56.4 |
|
|
(6.4 |
) |
Restructuring charges |
|
16.4 |
|
|
10.8 |
|
|
51.9 |
|
|
|
28.9 |
|
|
49.3 |
|
|
(41.4 |
) |
Other charges/(gains) |
|
9.1 |
|
|
15.7 |
|
|
(42.0 |
) |
|
|
13.7 |
|
|
41.2 |
|
|
(66.7 |
) |
Interest expense |
|
24.4 |
|
|
28.6 |
|
|
(14.7 |
) |
|
|
78.3 |
|
|
88.4 |
|
|
(11.4 |
) |
Asset impairment charge (h) |
|
73.8 |
|
|
50.1 |
|
|
47.3 |
|
|
|
303.1 |
|
|
50.1 |
|
|
505.0 |
|
Manufacturing facility fire (i) |
|
(4.7 |
) |
|
3.0 |
|
|
(256.7 |
) |
|
|
1.9 |
|
|
3.0 |
|
|
(36.7 |
) |
Transformation costs (j) |
|
- |
|
|
0.7 |
|
|
(100.0 |
) |
|
|
- |
|
|
3.0 |
|
|
(100.0 |
) |
Governance advisory services and leadership transitions (k) |
|
0.5 |
|
|
- |
|
NM |
|
|
|
44.2 |
|
|
- |
|
NM |
|
||
Income taxes |
|
(9.4 |
) |
|
23.9 |
|
|
(139.3 |
) |
|
|
(14.3 |
) |
|
89.4 |
|
|
(116.0 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
EBITDA before charges/(gains) (c) |
|
196.5 |
|
|
247.4 |
|
|
(20.6 |
) |
|
|
628.5 |
|
|
677.3 |
|
|
(7.2 |
) |
*Depreciation excludes accelerated depreciation expense of zero for the thirteen weeks ended September 26, 2026, and $(0.2) million for the thirty-nine weeks ended September 26, 2026 and excludes accelerated depreciation expense of $5.2 million for the thirteen weeks ended September 27, 2025, and $21.0 million for the thirty-nine weeks ended September 27, 2025. Accelerated depreciation is included in other charges/(gains).
CALCULATION OF NET DEBT-TO-EBITDA BEFORE CHARGES/(GAINS) RATIO
As of September 26, 2026 |
|
|
|
|
|
Long-term debt ** |
|
|
$ |
2,296.6 |
|
Total debt |
|
|
|
2,296.6 |
|
Less: |
|
|
|
|
|
Cash and cash equivalents ** |
|
|
|
230.9 |
|
Net debt (1) (d) |
|
|
$ |
2,065.7 |
|
For the fifty-two weeks ended September 26, 2026 |
|
|
|
|
|
EBITDA before charges/(gains) (2) (c) |
|
|
$ |
829.6 |
|
|
|
|
|
|
|
Net debt-to-EBITDA before charges/(gains) ratio (1/2)(e) |
|
|
2.5 |
|
|
** Amounts are per the Unaudited Condensed Consolidated Balance Sheet as of September 26, 2026.
|
Thirteen Weeks Ended |
|
Thirty-Nine Weeks Ended |
|
Fifty-Two Weeks Ended |
|
|
|||
|
December 27, 2025 |
|
September 26, 2026 |
|
September 26, 2026 |
|
|
|||
|
|
|
|
|
|
|
|
|||
Net income |
$ |
76.4 |
|
$ |
51.6 |
|
$ |
128.0 |
|
|
|
|
|
|
|
|
|
|
|||
Depreciation*** |
$ |
25.6 |
|
$ |
68.3 |
|
$ |
93.9 |
|
|
Amortization of intangible assets |
|
18.8 |
|
|
52.8 |
|
|
71.6 |
|
|
Restructuring charges |
|
3.1 |
|
|
28.9 |
|
|
32.0 |
|
|
Other charges/(gains) |
|
12.0 |
|
|
13.7 |
|
|
25.7 |
|
|
Interest expense |
|
26.8 |
|
|
78.3 |
|
|
105.1 |
|
|
Asset impairment charge (h) |
|
3.5 |
|
|
303.1 |
|
|
306.6 |
|
|
Manufacturing facility fire (i) |
|
18.1 |
|
|
1.9 |
|
|
20.0 |
|
|
Governance advisory services and leadership transitions (k) |
|
- |
|
|
44.2 |
|
|
44.2 |
|
|
Income taxes |
|
16.8 |
|
|
(14.3 |
) |
|
2.5 |
|
|
EBITDA before charges/(gains) (c) |
$ |
201.1 |
|
$ |
628.5 |
|
$ |
829.6 |
|
|
*** Depreciation excludes accelerated depreciation expense of $(0.2) million for the thirty-nine weeks ended September 26, 2026, and $(1.8) million for the thirteen weeks ended December 27, 2025. Accelerated depreciation is included in other charges/(gains).
(c) (d) (e) (h) (i) (j) (k) For definitions of Non-GAAP financial measures, see Definitions of Terms: Non-GAAP Financial Measures page
NM = Not meaningful
RECONCILIATION OF DILUTED EPS BEFORE CHARGES/(GAINS)
For the thirteen weeks ended September 26, 2026 diluted EPS before charges/(gains) is calculated as net income on a diluted per-share basis, excluding $16.4 million ($15.5 million after tax or $0.13 per diluted share) of restructuring charges, $9.1 million ($8.7 million after tax or $0.07 per diluted share) of other charges/gains, $73.8 million ($55.2 million after tax or $0.47 per diluted share) of asset impairment charges, ($4.7) million (($3.5) million after tax or ($0.03) per diluted share) of net costs relating to a manufacturing facility fire and a discrete tax impact of China commercial exit of $9.2 million ($0.08 per diluted share).
For the thirty-nine weeks ended September 26, 2026, diluted EPS before charges/(gains) is calculated as net income on a diluted per-share basis, excluding $28.9 million ($24.9 million after tax or $0.21 per diluted share) of restructuring charges, $13.7 million ($12.1 million after tax or $0.10 per diluted share) of other charges/gains, $303.1 million ($227.3 million after tax or $1.90 per diluted share) of asset impairment charges, $1.9 million ($1.3 million after tax or $0.01 per diluted share) of net costs relating to a manufacturing facility fire, $44.2 million ($33.8 million after tax or $0.28 per diluted share) of costs associated with governance advisory services and leadership changes and a discrete tax impact of China commercial exit of $9.2 million ($0.08 per diluted share).
For the thirteen weeks ended September 27, 2025, the diluted EPS before charges/(gains) is calculated as net income from on a diluted per-share basis, excluding $50.1 million ($37.6 million after tax or $0.31 per diluted share) of asset impairment charges, $10.8 million ($8.2 million after tax or $0.07 per diluted share) of restructuring charges, $15.7 million ($11.8 million after tax or $0.10 per diluted share) of other charges/(gains), and $3.0 million ($2.3 million after tax or $0.02 per diluted share) of costs due to manufacturing facility fire.
For the thirty-nine weeks ended September 27, 2025, the diluted EPS before charges/(gains) is calculated as net income on a diluted per-share basis, excluding $50.1 million ($37.6 million after tax or $0.31 per diluted share) of asset impairment charges, $49.3 million ($37.9 million after tax or $0.32 per diluted share) of restructuring charges, $41.2 million ($30.8 million after tax or $0.25 per diluted share) or other charges/(gains), $3.0 million ($2.3 million after tax or $0.02 per diluted share) of costs due to manufacturing facility fire and $3.0 million ($2.3 million after tax or $0.02 per diluted share) of transformation costs.
|
Thirteen Weeks Ended |
|
|
|
|
Thirty-Nine Weeks Ended |
|
|
|
||||||||||
|
September 26, 2026 |
|
September 27, 2025 |
|
% Change |
|
|
September 26, 2026 |
|
September 27, 2025 |
|
% Change |
|
||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Earnings per common share (EPS) - Diluted |
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Diluted EPS (GAAP) |
$ |
0.42 |
|
$ |
0.59 |
|
|
(28.8 |
) |
|
$ |
0.43 |
|
$ |
1.83 |
|
|
(76.4 |
) |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||
Restructuring charges |
|
0.13 |
|
|
0.07 |
|
|
85.7 |
|
|
|
0.21 |
|
|
0.32 |
|
|
(34.4 |
) |
Other charges/(gains) |
|
0.07 |
|
|
0.10 |
|
|
(30.0 |
) |
|
|
0.10 |
|
|
0.25 |
|
|
(60.0 |
) |
Asset impairment charge (h) |
|
0.47 |
|
|
0.31 |
|
|
51.6 |
|
|
|
1.90 |
|
|
0.31 |
|
|
512.9 |
|
Manufacturing facility fire (i) |
|
(0.03 |
) |
|
0.02 |
|
|
(250.0 |
) |
|
|
0.01 |
|
|
0.02 |
|
|
(50.0 |
) |
Transformation costs (j) |
|
- |
|
|
- |
|
|
- |
|
|
|
- |
|
|
0.02 |
|
|
(100.0 |
) |
Governance advisory services and leadership transitions (k) |
|
- |
|
|
- |
|
|
- |
|
|
|
0.28 |
|
|
- |
|
NM |
|
|
Discrete tax impact of China commercial exit (n) |
|
0.08 |
|
|
- |
|
NM |
|
|
|
0.08 |
|
|
- |
|
NM |
|
||
Diluted EPS before charges/(gains) (f) |
$ |
1.14 |
|
$ |
1.09 |
|
|
4.6 |
|
|
$ |
3.01 |
|
$ |
2.75 |
|
|
9.5 |
|
(h) (i) (j) (k) (f) (n) For definitions of Non-GAAP financial measures, see Definitions of Terms: Non-GAAP Financial Measures page
NM = Not meaningful
FORTUNE BRANDS INNOVATIONS, INC.
OPERATING MARGIN TO OPERATING MARGIN BEFORE CHARGES/(GAINS)
(Unaudited)
|
|
|
Thirteen Weeks Ended |
|
|
Thirty-Nine Weeks Ended |
|
||
|
|
|
September 26, 2026 |
September 27, 2025 |
Change |
|
September 26, 2026 |
September 27, 2025 |
Change |
WATER |
|
|
|
|
|
|
|
|
|
Operating margin (g) |
|
|
2.3% |
23.6% |
(2130) bps |
|
16.7% |
22.1% |
(540) bps |
Restructuring charges |
|
|
2.2% |
0.7% |
|
|
1.0% |
1.2% |
|
Other charges/(gains) |
|
|
|
|
|
|
|
|
|
Selling, general and administrative expenses |
|
|
1.2% |
0.1% |
|
|
0.4% |
0.2% |
|
Asset impairment charge (h) |
|
|
11.9% |
- |
|
|
4.0% |
- |
|
Before charges/(gains) operating margin (g) |
|
|
17.6% |
24.4% |
(680) bps |
|
22.1% |
23.5% |
(140) bps |
|
|
|
|
|
|
|
|
|
|
OUTDOORS |
|
|
|
|
|
|
|
|
|
Operating margin (g) |
|
|
15.1% |
(1.5%) |
1660 bps |
|
(10.7%) |
5.8% |
(1650) bps |
Restructuring charges |
|
|
0.3% |
0.1% |
|
|
0.2% |
0.5% |
|
Other charges/(gains) |
|
|
|
|
|
|
|
|
|
Cost of products sold |
|
|
0.1% |
0.9% |
|
|
0.2% |
0.9% |
|
Selling, general and administrative expenses |
|
|
- |
0.6% |
|
|
- |
0.7% |
|
Asset impairment charge (h) |
|
|
1.2% |
14.5% |
|
|
23.1% |
4.8% |
|
Manufacturing facility fire (i) |
|
|
(1.4%) |
0.9% |
|
|
0.2% |
0.3% |
|
Before charges/(gains) operating margin (g) |
|
|
15.3% |
15.5% |
(20) bps |
|
13.0% |
13.0% |
0 bps |
SECURITY |
|
|
|
|
|
|
|
|
|
Operating margin (g) |
|
|
21.1% |
14.9% |
620 bps |
|
21.0% |
12.6% |
840 bps |
Restructuring charges |
|
|
0.2% |
0.8% |
|
|
0.2% |
1.4% |
|
Other charges/(gains) |
|
|
|
|
|
|
|
|
|
Cost of products sold |
|
|
- |
0.1% |
|
|
- |
0.7% |
|
Selling, general and administrative expenses |
|
|
- |
2.0% |
|
|
- |
1.0% |
|
Before charges/(gains) operating margin (g) |
|
|
21.3% |
17.8% |
350 bps |
|
21.2% |
15.7% |
550 bps |
|
|
|
|
|
|
|
|
|
|
TOTAL COMPANY |
|
|
|
|
|
|
|
|
|
Operating margin (g) |
|
|
5.4% |
11.0% |
(560) bps |
|
3.4% |
11.6% |
(820) bps |
Restructuring charges |
|
|
1.5% |
0.9% |
|
|
0.9% |
1.5% |
|
Other charges/(gains) |
|
|
|
|
|
|
|
|
|
Cost of products sold |
|
|
- |
0.3% |
|
|
- |
0.4% |
|
Selling, general and administrative expenses |
|
|
0.9% |
1.0% |
|
|
0.4% |
0.8% |
|
Asset impairment charge (h) |
|
|
6.6% |
4.3% |
|
|
9.3% |
1.5% |
|
Manufacturing facility fire (i) |
|
|
(0.4%) |
0.3% |
|
|
0.1% |
0.1% |
|
Transformation costs (j) |
|
|
- |
0.1% |
|
|
- |
0.1% |
|
Governance advisory services and leadership transitions (k) |
|
|
- |
- |
|
|
1.3% |
- |
|
Before charges/(gains) operating margin (g) |
|
|
14.0% |
17.9% |
(390) bps |
|
15.4% |
16.0% |
(60) bps |
(g) (h) (i) (j) (k) For definitions of Non-GAAP financial measures, see Definitions of Terms: Non-GAAP Financial Measures page
FORTUNE BRANDS INNOVATIONS, INC.
RECONCILIATION OF GAAP NET SALES TO NET SALES EXCLUDING THE IMPACT OF CHINA SALES
(Unaudited)
|
|
Thirteen Weeks Ended September 26, 2026 vs Thirteen Weeks Ended September 27, 2025 |
|
|
% Change |
Water |
|
|
Percentage change in net sales (GAAP) |
|
(5.5%) |
Excluding China sales |
|
1.2% |
Net sales excluding impact of China (l) |
|
(4.3%) |
|
|
|
|
|
|
|
|
Thirteen Weeks Ended September 26, 2026 vs Thirteen Weeks Ended September 27, 2025 |
|
|
% Change |
Total Company |
|
|
Percentage change in net sales (GAAP) |
|
(3.1%) |
Excluding China sales |
|
0.7% |
Net sales excluding impact of China (l) |
|
(2.4%) |
|
|
Thirty-Nine Weeks Ended September 26, 2026 vs Thirty-Nine Weeks Ended September 27, 2025 |
|
|
% Change |
Water |
|
|
Percentage change in net sales (GAAP) |
|
(4.2%) |
Excluding China sales |
|
1.3% |
Net sales excluding impact of China (l) |
|
(2.9%) |
|
|
|
|
|
|
|
|
Thirty-Nine Weeks Ended September 26, 2026 vs Thirty-Nine Weeks Ended September 27, 2025 |
|
|
% Change |
Total Company |
|
|
Percentage change in net sales (GAAP) |
|
(3.2%) |
Excluding China sales |
|
0.8% |
Net sales excluding impact of China (l) |
|
(2.4%) |
(l) For definitions of Non-GAAP financial measures, see Definitions of Terms: Non-GAAP Financial Measures page
FORTUNE BRANDS INNOVATIONS, INC.
RECONCILIATION OF OUTDOORS GAAP NET SALES TO OUTDOORS NET SALES EXCLUDING IMPACT OF FIBERON
(Unaudited)
|
|
Thirteen Weeks Ended September 26, 2026 vs Thirteen Weeks Ended September 27, 2025 |
|
|
% Change |
Outdoors |
|
|
Percentage change in net sales (GAAP) |
|
0.8% |
Excluding Fiberon Sales (GAAP) |
|
2.6% |
Net sales excluding impact of Fiberon (m) |
|
3.4% |
|
|
|
|
|
|
|
|
Thirty-Nine Weeks Ended September 26, 2026 vs Thirty-Nine Weeks Ended September 27, 2025 |
|
|
% Change |
Outdoors |
|
|
Percentage change in net sales (GAAP) |
|
(2.1%) |
Excluding Fiberon Sales (GAAP) |
|
2.1% |
Net sales excluding impact of Fiberon (m) |
|
0% |
(m) For definitions of Non-GAAP financial measures, see Definitions of Terms: Non-GAAP Financial Measures page
Definitions of Terms: Non-GAAP Financial Measures
(a) Operating income (loss) before charges/gains is calculated as operating income (loss) derived in accordance with U.S. generally accepted accounting principles (“GAAP”), excluding restructuring, other charges/gains, asset impairment charges, manufacturing facility fire, transformation costs and governance advisory services and leadership transitions. Operating income (loss) before charges/gains is a measure not derived in accordance with GAAP. Management uses this measure to evaluate the returns generated by the Company and its business segments. Management believes this measure provides investors with helpful supplemental information regarding the underlying performance of the Company from period to period. This measure may be inconsistent with similar measures presented by other companies.
(b) Free cash flow is cash flow from operations calculated in accordance with U.S. generally accepted accounting principles ("GAAP") less capital expenditures. Free cash flow does not include adjustments for certain non-discretionary cash flows such as mandatory debt repayments. Free cash flow is a measure not derived in accordance with GAAP. Management believes that free cash flow provides investors with helpful supplemental information about the Company's ability to fund internal growth, make acquisitions, repay debt and related interest, pay dividends and repurchase common stock. This measure may be inconsistent with similar measures presented by other companies.
(c) EBITDA before charges/gains is calculated as net income (loss) in accordance with GAAP, excluding depreciation, amortization of intangible assets, restructuring and other charges/gains, interest expense, asset impairment charge, manufacturing facility fire, transformation costs, governance advisory services and leadership transitions, and income taxes. EBITDA before charges/gains is a measure not derived in accordance with GAAP. Management uses this measure to assess returns generated by the Company. Management believes this measure provides investors with helpful supplemental information about the Company's ability to fund internal growth, make acquisitions and repay debt and related interest. This measure may be inconsistent with similar measures presented by other companies.
(d) Net debt is calculated as long-term debt less cash and cash equivalents. Net debt is a measure not derived in accordance with GAAP. Management believes this supplemental measure is useful as it reflects the Company's debt obligations after considering cash and cash equivalents available to repay such obligations.
(e) Net debt-to-EBITDA before charges/gains ratio is calculated as net debt divided by EBITDA before charges/gains for the trailing 52 weeks. Management believes net debt-to-EBITDA before charges/gains is a useful measure of the Company's leverage position because it provides investors with helpful supplemental information about the Company's ability to service and repay outstanding debt using earnings from the underlying performance of the Company. This measure may be inconsistent with similar measures presented by other companies.
(f) Diluted earnings (loss) per share before charges/gains is calculated as net income on a diluted per-share basis, excluding restructuring, other charges/gains, asset impairment charges, manufacturing facility fire, transformation costs, governance advisory services and leadership transitions and a discrete tax impact of the China commercial exit. This measure is not in accordance with GAAP. Management uses this measure to evaluate the Company's overall performance and believes it provides investors with helpful supplemental information about the Company's underlying performance from period to period. However, this measure may not be consistent with similar measures presented by other companies.
(g) Operating margin is calculated as operating income in accordance with GAAP, divided by the GAAP net sales. The operating margin before charges/gains is calculated as operating income, excluding restructuring, other charges/gains, asset impairment charges, manufacturing facility fire, transformation costs, governance advisory services and leadership transitions, divided by GAAP net sales. The operating margin before charges/gains is not a measure derived in accordance with GAAP. Management uses this measure to evaluate the returns generated by the Company and its business segments. Management believes that this measure provides investors with helpful supplemental information about the Company's underlying performance from period to period. However, this measure may not be consistent with similar measures presented by other companies.
(h) For the thirteen and thirty-nine weeks ended September 26, 2026, impairment charges of $4.3 million and $233.0 million, respectively, were recorded related to the Fiberon asset group within the Outdoors segment. The impairment charge was related to certain identifiable intangible assets as well as property and equipment. For the thirteen and thirty-nine weeks ended September 26, 2026, impairment charges of $69.5 million and $70.1 million, respectively, were recorded for certain identifiable intangible assets and property and equipment related to rationalizing the EMEA operating footprint, impacting asset groups within the Water segment. For the thirteen and thirty-nine weeks ended September 27, 2025, an impairment charge of $50.1 million was recorded related to the classification of certain assets within the Outdoor segment as held-for-sale. For the thirteen weeks ended December 27, 2025, an impairment charge of $3.5 million was recorded related to the classification of certain assets to equal their fair value, less estimated costs to sell.
(i) For the thirteen and thirty-nine weeks ended September 26, 2026, we recognized ($4.7) million and $1.9 million, respectively, and for the thirteen and thirty-nine weeks ended September 27, 2025 we recognized $3.0 million, related to a fire at one of our manufacturing facilities within the Outdoors segment. For the thirteen weeks ended December 27, 2025, we recognized $18.1 million related to a fire at one of our manufacturing facilities within the Outdoors segment.
(j) For the thirteen and thirty-nine weeks ended September 27, 2025, professional fees incurred related to ongoing transformation initiatives were $0.7 million and $3.0 million, respectively, at Corporate.
(k) For the thirteen and thirty-nine weeks ended September 26, 2026, the Company incurred charges of $0.5 million and $44.2 million, respectively, associated with governance advisory services and leadership transitions.
(l) Net sales excluding the impact of China sales is net sales derived in accordance with GAAP excluding the impact of China sales. Management uses this measure to evaluate the overall performance of its segments and believes this measure provides investors with helpful supplemental information regarding the underlying performance of the Company and its reportable segments from period to period. This measure may be inconsistent with similar measures presented by other companies.
(m) Outdoors net sales excluding the impact of Fiberon sales is net sales for the Outdoors segment derived in accordance with GAAP excluding the impact of Fiberon sales. On October 15, 2026, the Company entered into a definitive agreement to sell its Fiberon composite decking business to a subsidiary of Inteplast Group Corporation for $160 million, subject to the terms and conditions of the agreement. Management uses this measure to evaluate the overall performance of the Outdoors segment and believes this measure provides investors with helpful supplemental information regarding the underlying performance of the segment from period to period. This measure may be inconsistent with similar measures presented by other companies.
(n) On September 25, 2026, the Board of Directors approved a plan to exit its Moen commercial business serving domestic markets in Asia. The Company will continue to conduct supply chain operations in China. For the thirteen and thirty-nine weeks ended September 26, 2026, the Company incurred discrete tax charges of $9.2 million ($0.08 per diluted share) related to certain China tax attributes that are no longer expected to be realized as a result of the commercial operations exit.
Additional Information:
For certain forward-looking non-GAAP financial measures (as used in this press release, EPS before charges / gains), the Company is unable to provide a reconciliation to the most comparable GAAP financial measure because the information needed to reconcile the non-GAAP financial measure to the GAAP financial measure is unavailable due to the inherent difficulty of forecasting the timing and / or amount of various items that have not yet occurred, including the high variability and low visibility with respect to gains and losses associated with our defined benefit plans, and restructuring and other charges, each of which are excluded from EPS before charges / gains, other than with respect to the Company’s previously-announced estimated additional non-cash impairment charge for the Fiberon asset group of approximately $175 million to $205 million. As a result, the Company is not otherwise able to reasonably estimate the probable significance of such items. Additionally, estimating such GAAP measures and providing a meaningful reconciliation consistent with the Company’s accounting policies for future periods requires a level of precision that is unavailable for these future periods and cannot be accomplished without unreasonable effort. Forward-looking non-GAAP financial measures are estimated consistent with the relevant definitions and assumptions. For a reconciliation of full year 2026 free cash flow guidance to full year 2026 operating cash flow guidance, see the table entitled “Free Cash Flow”.