GuruFocus Premium Membership

Serving Intelligent Investors since 2004. Only 96 cents a day.

Free Trial

Free 7-day Trial
All Articles and Columns »

Brunswick Corp. Reports Operating Results (10-Q)

May 07, 2010 | About:
10qk

10qk

18 followers
Brunswick Corp. (BC) filed Quarterly Report for the period ended 2010-04-03.

Brunswick Corp. has a market cap of $1.69 billion; its shares were traded at around $19.1 with and P/S ratio of 0.7. The dividend yield of Brunswick Corp. stocks is 0.2%.BC is in the portfolios of Arnold Schneider of Schneider Capital Management, David Tepper of APPALOOSA MANAGEMENT LP, Kenneth Fisher of Fisher Asset Management, LLC, Jim Simons of Renaissance Technologies LLC, Charles Brandes of Brandes Investment.

Highlight of Business Operations:

Quarterly operating earnings were $10.1 million with an operating margin of 1.2 percent. These results included $7.4 million of restructuring, exit and impairment charges recorded during the first quarter of 2010. In the three months ended April 4, 2009, the Company recorded a quarterly operating loss of $127.5 million, with a negative operating margin of 17.4 percent, which included restructuring, exit and impairment charges of $39.6 million. The improvement in operating earnings during the first quarter of 2010 when compared with the first quarter of 2009 was primarily the result of higher overall unit sales discussed above and improved fixed-cost absorption from the increased production levels, as well as lower discounts provided to facilitate retail boat sales. Additionally, operating earnings in the first quarter of 2010 benefited from lower restructuring, exit and impairment charges, cost reductions from successful cost-reduction initiatives, and lower pension and bad debt expense.

During the three months ended April 3, 2010, the Company recognized a tax provision of $0.3 million, despite a loss of $12.7 million before taxes. The Company would ordinarily recognize a tax benefit on operating losses; however, due to the Company s recent cumulative losses for book purposes and the uncertainty of the realization of certain deferred tax assets, the Company continues to adjust its valuation allowances accordingly as the deferred tax assets increase or decrease resulting in effectively no recorded federal tax benefit. The Company is in a similar situation in certain state and foreign taxing jurisdictions, but an income tax provision or benefit is still required for those entities that are not in cumulative loss positions. The tax provision of $0.3 million for the three months ended April 3, 2010 included a tax provision of $2.4 million related to state and foreign locations where the Company is not in a cumulative loss position, partially offset by a $2.1 million benefit related to the reassessment of tax reserves.

During the three months ended April 4, 2009, the Company recognized a tax provision of $34.4 million, despite incurring a loss of $149.8 million before taxes. As described above, the Company would typically recognize a tax benefit on losses before income taxes; however, due to the uncertainty of the realization of certain state and foreign net deferred tax assets, $36.6 million of special tax charges were recognized primarily to reduce certain state and foreign net deferred tax assets to their anticipated realizable value.

Tax Items. The tax provision of $0.3 million for the three months ended April 3, 2010 included a tax provision of $2.4 million related to state and foreign locations where the Company is not in a cumulative loss position, partially offset by a $2.1 million benefit related to the reassessment of tax reserves. During the three months ended April 4, 2009, the Company recognized a tax provision of $34.4 million, despite incurring a loss of $149.8 million before taxes. The Company would typically recognize a tax benefit on losses before income taxes; however, due to the uncertainty of the realization of certain state and foreign net deferred tax assets, $36.6 million of special tax charges were recognized primarily to reduce certain state and foreign net deferred tax assets to their anticipated realizable value.

During the three months ended April 3, 2010, the Company recognized a tax provision of $0.3 million, despite a loss of $12.7 million before taxes. The Company would ordinarily recognize a tax benefit on operating losses; however, due to the Company s recent cumulative losses for book purposes and the uncertainty of the realization of certain deferred tax assets, the Company continues to adjust its valuation allowances accordingly as the deferred tax assets increase or decrease resulting in effectively no recorded federal tax benefit. The Company is in a similar situation in certain state and foreign taxing jurisdictions, but an income tax provision or benefit is still required for those entities that are not in cumulative loss positions. The tax provision of $0.3 million for the three months ended April 3, 2010 included a tax provision of $2.4 million related to state and foreign locations where the Company is not in a cumulative loss position, partially offset by a $2.1 million benefit related to the reassessment of tax reserves.

During the three months ended April 4, 2009, the Company recognized a tax provision of $34.4 million, despite incurring a loss of $149.8 million before taxes. As described above, the Company would typically recognize a tax benefit on losses before income taxes; however, due to the uncertainty of the realization of certain state and foreign net deferred tax assets, $36.6 million of special tax charges were recognized primarily to reduce certain state and foreign net deferred tax assets to their anticipated realizable value.

Read the The complete Report

About the author:

10qk
GuruFocus - Stock Picks and Market Insight of Gurus

Rating: 3.8/5 (4 votes)

Comments

Please leave your comment:


Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
Free 7-day Trial
FEEDBACK