You are given a text that consists of multiple sentences. Your task is to perform abstractive summarization on this text. Use your understanding of the content to express the main ideas and crucial details in a shorter, coherent, and natural sounding text. 
Text: This document will remain there following our call.
Our call will be led by David Maura, Chairman and Chief Executive Officer; Jeremy Smeltser, Chief Financial Officer; and Randy Lewis, Chief Operating Officer.
Turning to slides three and four.
Actual results may differ materially.
You have all overcome a lot over these past 18 months, and I'm very proud of you.
The management team and I appreciate each and every one of you.
We should all be proud of our progress, which is further confirmation of the durability of our business and our winning playbook.
Our teams have embraced both our global operating model and the spirit of our servant leadership culture.
We persevered through a global pandemic to deliver excellent and consistent financial performance for our stakeholders.
And our fourth quarter financial results reflect another quarter of top and bottom line growth.
And it reinforces that we are truly structured for growth and efficiency to serve our consumers, customers and our stakeholders.
On a year-to-date basis, our businesses have delivered 19% organic net sales growth and 36% EBITDA growth.
The new Spectrum Brands is, in fact, a more efficient, focused, productive and consistent operating company, and we are confident in our ability to manage through the near-term volatility, including the current inflationary headwinds and supply chain disruptions.
We have and will manage through these challenges with the same discipline and collaboration that allowed Spectrum Brands to navigate the tariff headwinds in 2019 and the pandemic restrictions of 2020.
We will emerge a more durable company with a more resilient supply chain, and we will continue to be driven by our values of trust, accountability, and collaboration to serve our mission, which is, we make living better at home.
We again delivered top and bottom line growth in the quarter, and we continued to plant seeds for future growth with our investments in innovation, marketing and advertising across each of our businesses.
Our third quarter net sales grew 18.1%, driven by growth across all business units, with standout performance from HHI.
This double-digit top line performance also reflects 14% total company growth against our 2019 levels and reflects our actions over the last few years to reignite the flywheel of growth for our trusted brands.
Now turning to the bottom line.
Third quarter net income from continuing operations was $34.9 million, and adjusted EBITDA was $167.4 million, mainly driven by HHI's organic growth.
What I'm actually most proud of this quarter is the discipline exhibited by all four business units, as our EBITDA this quarter included an additional $19 million in innovation, marketing and advertising spend versus the period a year ago.
The fact that our operators of our businesses continue to lean in and invest for long-term future growth despite the current macro challenges is evidence to me that our culture -- the culture of this company has changed and we are truly focused on sustainable growth.
Adjusted earnings per share grew 15.4% despite headwinds from inflation and incremental investments in marketing and advertising, as our teams continue to focus on driving efficiencies from our Global Productivity Improvement Program and implementing pricing actions.
We were also opportunistic this quarter with a share repurchase program, buying back over $10 million worth of Spectrum Brands shares.
Turning to slide seven.
Headwinds from inflationary pressures stepped up in the quarter, as expected, driven by transportation and commodity costs.
But despite these continued headwinds, we remain committed to delivering on our earnings framework with mid-teens net sales and adjusted EBITDA growth and adjusted free cash flow of $260 million to $280 million.
We will continue to focus on the disciplined execution of our winning playbook by investing in our people, continuing to drive a culture of servant leadership, empowering and resourcing our teams to win in the marketplace with news and excitement from new product introductions.
Our balance sheet this quarter remained strong with net leverage of 3.6 times, and we have over $600 million in total liquidity.
We also successfully closed on the Rejuvenate acquisition during the quarter for approximately $300 million, adding a fourth category to our ever-expanding Home & Garden business.
Turning to slide nine.
Going forward, our capital allocation priorities will continue to focus on: one, allocating capital internally to our highest return opportunities, and this includes strengthening our brands through consumer insights, innovation and advertising and promotion and marketing to drive the vitality of our business and drive profitable organic growth; two, we plan to return cash to shareholders via dividends and opportunistic share repurchases; and third, we will continue with disciplined M&A, with tuck-in strategic acquisitions that are synergistic and help drive value creation.
I'm very pleased to report to all of our stakeholders that all of our recent acquisitions, including Omega Sea, Armitage and Rejuvenate are performing at or above our original deal expectations.
We continue to target net leverage in the 3 times to 4 times range.
Now you'll hear more from Jeremy on the financials, and Randy will update you with additional business unit insights.
Turning to slide 11, and review Q3 results from continuing operations, beginning with net sales.
Net sales increased 18.1%.
Excluding the impact of $25.9 million of favorable foreign exchange and acquisition sales of $34.3 million, organic net sales increased 12%.
Net sales grew across all four business units.
Gross profit increased $58.5 million and gross margins of 35%, declined just 40 basis points from a year ago due to higher freight and input costs, partially offset by higher volumes, improved efficiencies from our GPIP initiative and favorable mix.
SG&A expense of $275.4 million, increased 22.5% at 23.7% of net sales, with the dollar increase driven by higher volumes, higher advertising and marketing investments, higher distribution and incentive costs, higher transaction-related costs and SG&A from our recent acquisitions.
Operating income of $98 million was driven by higher volumes, improved productivity and lower restructuring costs, partially offset by higher freight and input costs and marketing and advertising investments.
Declines in GAAP net income and diluted earnings per share were primarily driven by prior year gains from the company's prior Energizer common stock investments and gains from the extinguishment of Salus CLO debt.
Adjusted diluted earnings per share improved to $1.57, driven by favorable volumes and improved productivity.
Adjusted EBITDA increased 1.8% from the prior year, primarily driven by HHI.
Turning to slide 12.
Q3 interest expense from continuing operations of $31.4 million, decreased $4.7 million due to our lower cost of debt.
Cash taxes during the quarter of $8.6 million were $4.8 million higher than last year.
Depreciation and amortization from continuing operations of $38.6 million was $3.6 million higher than the prior year.
Separately, share and incentive-based compensation decreased from $14.2 million last year to $7.5 million this year, driven by the change to incentive compensation payout methodology.
Cash payments for transactions were $16 million, up from $7.2 million last year.
And restructuring and related payments were $5.1 million versus $25.2 million last year.
Moving to the balance sheet.
The company had a quarter-end cash balance of $130 million and $478 million available on its $600 million Cash Flow Revolver.
Total debt outstanding was approximately $2.7 billion, consisting of $2.1 billion of senior unsecured notes, $497 million of term loans and revolver draws and $156 million of finance leases and other obligations.
Additionally, net leverage is 3.6 times.
And during the quarter, the company repurchased 115,000 shares for $10.2 million.
Capex was $15.2 million in Q3 versus $12.9 million last year.
Turning to slide 13 and our earnings framework for 2021.
We are reiterating our earnings framework for the year as we continue to expect mid-teens reported net sales growth in 2021, with foreign exchange expected to have a positive impact based on current rates.
Adjusted EBITDA is also expected to grow mid-teens.
This includes benefits from higher volumes, our GPIP efficiencies, approximately 11 months of results from the recent Armitage transaction in Global Pet Care and now includes approximately 4 months of Rejuvenate for Home & Garden, offset by net tariff headwinds of about $30 million to $35 million driven by the expiration of previously disclosed retrospective tariff exclusions in 2020.
In addition, as David mentioned, we have factored in $120 million to $130 million of input cost inflation compared to a year ago primarily in the second half of the fiscal year.
Fiscal 2021 adjusted free cash flow from continuing operations is expected to be between $260 million and $280 million.
This includes plans for incremental investments in inventory levels as well as the expected input cost inflation.
Depreciation and amortization is expected to be between $180 million and $190 million, including stock-based compensation of approximately $30 million to $35 million.
Full year interest expense is expected to be between $130 million and $135 million.
Both restructuring and transaction-related cash spending as well as capital expenditures are expected to be between $70 million and $80 million.
Cash taxes are expected to be between $35 million and $40 million, and we do not anticipate being a significant US federal cash taxpayer during fiscal 2021 as we continue to use net operating loss carryforwards.
We ended the prior year with approximately $800 million of usable federal NOLs.
For adjusted EPS, we use a tax rate of 25%, which includes state taxes.
Regarding our capital allocation strategy, we continue to target a net leverage range of 3 times to 4 times adjusted EBITDA.
As it relates to the 2021 earnings framework, please keep in mind a few factors.
First, we continue to plan for incremental brand support investments of approximately $45 million for the year as we continue to raise awareness, consideration and purchase intent.
Second, recall the Q4 results this fiscal year will have 60 reselling days compared to the prior year.
It's an important to recognize this modeling nuance.
Third, we continue to manage through inflationary pressures, which are still expected to be $120 million to $130 million higher than last year.
Fourth, Q4 results this fiscal year will include the change to our incentive compensation program that was enacted in Q4 last year, positively impacting comparability by about $12.7 million compared to the prior year in Q4.
And lastly, adjusted EBITDA is also expected to be negatively impacted by the absence of Energizer dividend income.
Now over to Randy for a more detailed look at our operations.
My comments today will focus on within each business unit to provide detail on the underlying performance drivers of our operating results.
I will also update you on the current overall cost environment and our global productivity improvement program.
Overall, we continue to see significant benefits from our operating model transformation.
As David outlined earlier, our business is demonstrating its durability and our operating strategy is proving effective in helping us actively manage through today's headwinds.
While the impacts of COVID-19 over the past year are creating extreme volatility in the year-over-year and quarter-to-quarter comparisons of our businesses.
Overall, we continue to believe that consumer demand remains positive in our categories and the strong performance of our brands continues to drive long-term growth.
Q3 reflected another quarter of organic sales growth for the total company.
And despite industry supply chain challenges, we continue to work to improve our delivery performance and provide more consistent service levels to our customers, which is earning us positive feedback from those partners.
These efforts, in addition to our continued commitment to long-term commercial strategies, operational investments help drive another quarter of top and bottom line growth.
Now let's dive into the specifics for each business.
Starting with Hardware & Home Improvement on slide 15.
Third quarter reported net sales increased 48.8% and organic net sales increased 46.7%.
Top line performance was primarily driven by security sales growth over the prior year.
Last year, you will recall, we experienced COVID-19-related disruptions at our Hardware & Home Improvement manufacturing locations in Mexico and the Philippines due to temporary, government-ordered shutdowns.
It's important to highlight that we had double-digit growth across all HHI categories, even in comparison to strong results from the prior year in plumbing and builders hardware.
EBITDA increased 56%, primarily driven by volume growth and productivity improvements and partially offset by higher freight and input costs and higher advertising investments.
This represents our fourth consecutive quarter of strong double-digit sales growth for HHI, as well as 18% growth compared to 2019 levels.
We continue to expect demand to be driven by our new product introductions and increased advertising investments.
Additionally, fundamentals across both the repair and remodel and the new build channels continue to be strong.
As we turn to expectations for the next two quarters, we should look at last year's history.
If you recall, Q4 of last year started the strong rebound in sales as production of our security products recovered dramatically from the COVID-19 government shutdowns.
Our HHI teams across security, plumbing and builder's hardware continue to be focused on driving growth and taking share.
We will continue to invest in innovation, marketing and advertising and are seeing positive results in retail POS and benefits from recent commercial wins with Clayton Homes, Shea Homes and another -- and a number of other top 100 US builders.
Additionally, our Baldwin brand, the leader in luxury security products, recently launched its Quick Ship Program with a wide array of customized SKUs, shipping within five business days, to dramatically improve the customer experience in that category.
In Kwikset, we remain focused on driving demand with our exciting Halo and Halo Touch Smart Lock product lines, which includes biometric and WiFi-enabled technology, along with voice control capability through Alexa and Google Assistant.
Also contains SmartKey technology, which allows users to rekey their own locks to any Kwikset key in about 15 seconds.
And Microban, which incorporates antimicrobial technology on the surfaces of our hardware.
Now to Home & Personal Care, which is slide 16.
Reported inorganic net sales increased 9.5% and 4.2%, respectively.
Adjusted EBITDA decreased to $11.8 million.
Net sales were driven by continued strength in small kitchen appliances and personal care categories with notable growth from haircare and garment care segments.
The US continued to grow along with strong growth in Latin America as retail channels began reopening after shutdowns from COVID-19.
Lower EBITDA was driven by increased freight expense, substantial investments in marketing and advertising and input cost inflation.
This was partially offset by pricing actions, higher volumes and productivity improvements.
Q3 represented the eighth consecutive quarter of year-over-year top line growth for our appliance business.
Performance was driven by double-digit growth in haircare and garment care products as well as moderate continued growth in small kitchen appliances compared to the outstanding sales from last year.
Our consistent commercial wins over the last two years and continued investments give us confidence in our plans to continue growing share and taking shelf space with our key retailers.
As we outlined on our last call, inflationary headwinds as well as continued marketing investments in HPC in Q3 and Q4 only be partially offset by our pricing and supplier partnership initiatives.
This will put pressure on margins.
However, we continue to work to mitigate the inflation impact as we enter fiscal 2022.
Our focus in 2021 and beyond will remain in consumer-led, insights-driven new products with incremental sales opportunities as retailers continue to reopen.
And there is excitement for back-to-school, which was limited last year, as well as for the upcoming holiday season.
Moving to Global Pet Care, which is slide 17.
Q3 represented another quarter of top line growth.
Reported net sales grew 6.5%, while organic sales declined 7.2%.
Adjusted EBITDA declined 2.8%.
Higher net sales was attributable to acquisition sales, which drove companion animal category growth.
Top line results this quarter were impacted by lower-than-desired fulfillment levels during a June transition of 3PL providers at one of our major US distribution centers.
The fulfillment challenge was a transitional issue and customer shipment volume returned to pre-transition levels by the end of the quarter.
Lower EBITDA was driven by the distribution center transition, resulting in lower customer shipment volumes and increased operating costs.
Profits were also pressured by higher freight and input cost inflation and advertising investments, partially offset by productivity improvements and pricing actions.
The transition of service providers at the distribution center in the US was a planned strategic move.
Our Global Pet Care business has been a very strong performer for several years, with 11 consecutive quarters of sales growth.
We are very excited about the continued momentum of the business given the positive macro trends of the category and the strong performance of our brands.
Thus, to better serve our customers currently and to support our strategic growth plan, we partnered with a new 3PL provider and committed to significant increases in space and automation.
Our new partner is a Fortune 500 world-class service provider with extensive experience working with some of the largest companies in the consumer product space.
They have the experience, scale, systems and automation processes to take our Global Pet Care business to the next level of customer order fulfillment and supply chain efficiency.
The facility transition is now stable, and we expect the benefits of the new capabilities to start showing up this quarter.
As we said before, our Global Pet Care team remains confident that 2021 and beyond will benefit from the continued execution of our global strategies, coupled with the strong category growth fundamentals.
In particular, we anticipate sustained demand for our consumable products, given all the new pet parents in companion animal and all the new hobbies who have entered the acquired [Indecipherable] categories.
These are long-term commitments and bode very well for the future demand of our products.
In addition to operating a very strong business, our Global Pet Care unit is leading in another equally important area, giving back to society.
Through a long-standing relationship with our GloFish brand, we partner with an outstanding organization named Well Aware.
Well Aware is a non-profit organization headquartered in Austin, Texas that provides innovative and sustainable solutions to water scarcity in East Africa.
While our partnership goes back almost 10 years, this quarter, we completed one of our most successful fundraising campaigns ever through Well Aware's Shower Strike Program.
These fundraising actions, along with matching funds from Spectrum Brands, will directly contribute to providing a lifetime of clean, healthy water for thousands of people living in two communities in Southern Kenya.
And finally, Home & Garden, which is slide 18.
Third quarter reported net sales increased just less than 1%.
Organic sales declined 3% and adjusted EBITDA decreased 3.8%.
The net sales increase was driven by repellent category growth from distribution gains as well as contributions from the recently acquired Rejuvenate cleaning business.
Sales of herbicides and insecticides were negatively impacted by unfavorable weather through much of the first two months of the quarter.
The EBITDA decrease was driven by lower volumes and increased marketing investments and partially offset by pricing actions and productivity improvements.
Despite the challenging weather in Q3, our business continues to outperform the category, and POS performance thus far in Q4 has been positive, with more favorable weather patterns and continued strong retailer support despite ongoing challenges from raw materials and freight markets.
Given these ongoing challenges, the Home & Garden team has announced another round of planned price increases at the end of last month.
With the successful close of the Rejuvenate acquisition, our teams are also focused on capturing operational and revenue synergies with a business that has strong EBITDA margins and good customer alignment with our existing channels.
Recall that net sales for the business last year were over $60 million.
And just recently, Rejuvenate was named HGTV's best multipurpose hardwood floor cleaner.
We look forward to applying our strengths in supplier partnerships, manufacturing and marketing to further strengthen the Rejuvenate brand, particularly within underpenetrated channels and retailers.
Our continued A&P investments in Home & Garden this quarter are consistent with our strategy to invest more resources to tell our story around the brand, such as Spectracide, Cutter, Hot Shock, EcoLogic and now Rejuvenate.
We believe these actions will further enhance our mission to be the recognized market leader in providing consumers the best solutions to counter nature's challenges and enjoy life.
Now let's turn to our internal growth and efficiency efforts for Global Productivity Improvement Program on slide 19.
As David mentioned, we've remained laser-focused on execution of these key initiatives.
As Q3 delivered productivity improvements across all business units.
We remain resolute on using these savings to invest back into the business to drive long-term, sustainable, organic growth, especially during these challenging times.
This program continues to be our most important strategic initiative as we transform our global operating model, and we remain on track to deliver our total gross savings target of at least $200 million by the end of fiscal 2022.
Widespread inflationary headwinds stepped up this quarter and more meaningfully impacted our Q3 results.
As we said during our last quarter, we continue to expect these gross headwinds to be approximately $120 million to $130 million higher than fiscal 2020 levels.
While many of these headwinds are industrywide and often outside of our control, our results this quarter reflect our actions to address these impacts.
We are expecting -- we are executing and coordinating a consistent strategy across the enterprise using the tools developed through our GPIP program and leveraging our operating model.
We are partnering with suppliers to offset inflation, implementing mitigation actions and driving productivity improvements throughout all businesses, regions and functions.
As Jeremy alluded to earlier, these headwinds are currently included in our earnings framework for this year.
We implemented price increases with many of our retail partners in Q3, and we are taking additional pricing in Q4.
And if the current cost environment holds, we expect to be taking further pricing actions in fiscal 2022.
While we believe that some of these inflationary pressures are temporary in nature and may begin to moderate in fiscal 2022, we are preparing for higher levels of gross headwinds next year.
As a reminder, the inflation we are experiencing in fiscal 2021 is hitting us almost entirely in the second half of the year.
As we look forward to fiscal 2022, these inflationary headwinds are expected to be first half-weighted.
Now back to David.
Look, at this point, we've covered quite a bit on the call.
I want to conclude now with the key takeaways here on slide 21.
First, our third quarter financial results reflect another excellent quarter of top line growth driven by growth across every one of our business units.
This top line performance, however, you analyze it, reflects our actions over the last few years to reignite the flywheel of growth for our trusted brands.
Second, our third quarter financial results reflect adjusted EBITDA growth, despite inflationary headwinds, which stepped up in the quarter and continued challenges with our supply chain, but most importantly, it covered an incremental $19 million investment in innovation, marketing and advertising.
Third, our teams remain focused on managing with discipline and collaboration.
Our winning playbook gives us confidence in reiterating our 2021 earnings framework, and our GPIP program and efficiency targets are helping us finish the year strong.
As I stated, we expect a strong finish to fiscal 2021, and we have great momentum heading into fiscal 2022.
We remain encouraged by consumers' demands for our products and our retail partners' enthusiasm for our categories, brands and our new product launches.
As I sit here today, I'm excited and optimistic about the future of our businesses and our company as a whole.
As I mentioned earlier, the company's culture has shifted.
We are no longer focused on running our business for short-term results.
We are a more efficient company today and we are reinvesting much of the savings from our global productivity improvement program back into driving the growth of our four business units.
Additionally, the backdrop of low interest rates, the US consumer with approximately $2.5 trillion in liquid assets, combined with a strong housing market and a permanent demand shift higher for our Pet and Home & Garden product offerings paints the picture of a very strong macro demand environment for our company.
In summary, all of this adds up to a very favorable view of our prospects as we enter our fiscal 2022 on October 1st.
The new energy of our teams and the investments we've made in innovation, marketing and advertising leaves me enthusiastic about our new product development pipeline and our expected new product launches in fiscal 2022 and 2023.
I expect our current challenges on the supply chain to be mostly transitory, and I expect that we can overcome a lot of the headwinds that we're currently seeing on the inflation side.
The future of Spectrum Brands is genuinely bright.
I am extremely grateful for all the sacrifices of our Spectrum Brands employee partners that you've made to navigate our company successfully through these challenging times.
Dawn, let's just dive right into Q&A.

user
compname posts q3 adjusted earnings per share $1.57.
q3 adjusted earnings per share $1.57.
spectrum brands holdings continues to expect mid-teens reported net sales growth for fiscal 2021.
continues to expect adjusted ebitda to increase mid-teens for fiscal 2021.

assistant