[X]
ANNUAL
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES
EXCHANGE ACT OF 1934
|
For
the fiscal year ended December 31, 2006
|
or
|
[ ]
TRANSITION
REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE
SECURITIES
EXCHANGE ACT OF 1934
|
Commission
file number 1-1043
|
Delaware
|
36-0848180
|
(State
or other jurisdiction of incorporation
or
organization)
|
(I.R.S.
Employer Identification No.)
|
1
N. Field Court, Lake Forest, Illinois
|
60045-4811
|
(Address
of principal executive offices)
|
(Zip
Code)
|
(847)
735-4700
|
|
(Registrant’s
telephone number, including area
code)
|
Title
of each class
|
Name
of each exchange
on
which registered
|
Common
Stock ($0.75 par value)
|
New
York, Chicago and
|
Preferred
Stock Purchase Rights
|
London
Stock Exchanges
|
|
|
Page
|
PART
I
|
||
Item
1.
|
Business
|
1
|
Item
1A.
|
Risk
Factors
|
9
|
Item
1B.
|
Unresolved
Staff Comments
|
11
|
Item
2.
|
Properties
|
11
|
Item
3.
|
Legal
Proceedings
|
12
|
Item
4.
|
Submission
of Matters to a Vote of Security Holders
|
14
|
PART
II
|
||
Item
5.
|
Market
for Registrant’s Common Equity, Related Stockholder
Matters
and Issuer Purchases of Equity Securities
|
15
|
Item
6.
|
Selected
Financial Data
|
17
|
Item
7.
|
Management’s
Discussion and Analysis of Financial Condition
and
Results of Operations
|
19
|
Item
7A.
|
Quantitative
and Qualitative Disclosures About Market Risk
|
40
|
Item
8.
|
Financial
Statements and Supplementary Data
|
41
|
Item
9.
|
Changes
in and Disagreements with Accountants on Accounting
and
Financial Disclosure
|
41
|
Item
9A.
|
Controls
and Procedures
|
41
|
PART
III
|
||
Item
10.
|
Directors,
Executive Officers and Corporate Governance
|
42
|
Item
11.
|
Executive
Compensation
|
42
|
Item
12.
|
Security
Ownership of Certain Beneficial Owners and
Management
and Related Stockholder Matters
|
42
|
Item
13.
|
Certain
Relationships and Related Transactions, and Director
Independence
|
42
|
Item
14.
|
Principal
Accounting Fees and Services
|
42
|
PART
IV
|
||
Item
15.
|
Exhibits
and Financial Statement Schedules
|
42
|
2006
|
2005
|
2004
|
||||||||
(in
millions)
|
||||||||||
Europe
|
$
|
925.1
|
$
|
926.4
|
$
|
849.4
|
||||
Pacific
Rim
|
303.2
|
315.6
|
277.9
|
|||||||
Canada
|
328.6
|
311.7
|
273.3
|
|||||||
Latin
America
|
158.3
|
133.7
|
101.2
|
|||||||
Africa
& Middle East
|
87.2
|
72.9
|
53.8
|
|||||||
$
|
1,802.4
|
$
|
1,760.3
|
$
|
1,555.6
|
– |
A
marine engine product customization plant and distribution center
in
Belgium serving Europe, Africa and the Middle
East;
|
– |
A
propeller and underwater sterngear manufacturing plant in the
United
Kingdom;
|
– |
Sales
offices and distribution centers in Australia, Brazil, Canada,
China,
Japan, Malaysia, Mexico, New Zealand, Singapore and the United
Arab
Emirates;
|
– | Sales offices in Belgium, Denmark, Finland, France, Germany, Italy, the Netherlands, Norway, Sweden, Switzerland and the United Kingdom; |
– |
Boat
manufacturing plants in Australia, China, Portugal and
Sweden;
|
– |
An
outboard engine assembly plant in Suzhou, China;
and
|
– |
A
marina and boat club in Suzhou, China, on Lake
Tai.
|
2006
|
2005
|
2004
|
||||||||
(in
millions)
|
||||||||||
Boat
|
$
|
38.0
|
$
|
36.1
|
$
|
28.3
|
||||
Marine
Engine
|
70.3
|
67.3
|
66.6
|
|||||||
Fitness
|
18.4
|
14.2
|
16.0
|
|||||||
Bowling
& Billiards
|
5.5
|
5.9
|
5.9
|
|||||||
Total
|
$
|
132.2
|
$
|
123.5
|
$
|
116.8
|
Boat
|
13,850
|
|||
Marine
Engine
|
6,400
|
|||
Fitness
|
2,050
|
|||
Bowling
& Billiards
|
5,400
|
|||
Corporate
|
300
|
|||
Total
|
28,000
|
Officer
|
Present
Position
|
Age
|
||
Dustan
E. McCoy
|
Chairman
and Chief Executive Officer
|
57
|
||
Peter
B. Hamilton (A)
|
Vice
Chairman and President - Brunswick Boat Group
|
60
|
||
Patrick
C. Mackey
|
Executive
Vice President, Chief Operating Officer - Marine
and
President - Mercury Marine Group
|
60
|
||
Peter
G. Leemputte
|
Senior
Vice President and Chief Financial Officer
|
49
|
||
Tzau
J. Chung
|
Vice
President and President - Brunswick New Technologies
|
43
|
||
Warren
N. Hardie
|
Vice
President and President - Brunswick Bowling &
Billiards
|
56
|
||
B.
Russell Lockridge
|
Vice
President and Chief Human Resources Officer
|
57
|
||
Alan
L. Lowe
|
Vice
President and Controller
|
55
|
||
Marschall
I. Smith
|
Vice
President, General Counsel and Secretary
|
62
|
||
John
E. Stransky
|
Vice
President and President - Life Fitness Division
|
55
|
Issuer
Purchases of Equity Securities
|
|||||||||||||
Period
|
Total
Number
of
Shares
(or
Units)
Purchased
|
Average
Price
Paid
per
Share
(or
Unit)
|
Total
Number of
Shares
(or Units)
Purchased
as Part of
Publicly
Announced
Plans
or Programs
|
Maximum
Number (or
Approximate
Dollar
Value)
of Shares (or
Units)
that May Yet Be
Purchased
Under the
Plans
or Programs
(in
thousands)
|
|||||||||
10/01/06
- 10/28/06
|
—
|
|
$
—
|
—
|
|
$
398,674
|
|||||||
10/29/06
- 11/25/06
|
150,000
|
|
$
32.52
|
150,000
|
|
$
393,796
|
|||||||
11/26/06
- 12/31/06
|
850,000
|
|
$
32.43
|
850,000
|
|
$
366,232
|
|||||||
Total
Share Repurchases
|
1,000,000
|
|
$
32.44
|
1,000,000
|
|
$
366,232
|
2001
|
2002
|
2003
|
2004
|
2005
|
2006
|
||||||
Brunswick
|
100.00
|
93.46
|
152.69
|
240.96
|
200.56
|
159.95
|
|||||
S&P
500 Index
|
100.00
|
76.63
|
96.85
|
105.56
|
108.73
|
123.54
|
|||||
S&P
500 GICS Consumer Discretionary
Index
|
100.00
|
75.56
|
102.82
|
115.31
|
106.83
|
125.24
|
(in
millions, except per share data)
|
2006
|
2005
|
2004
|
2003
|
2002
|
2001
|
|||||||||||||
Results
of operations data
|
|||||||||||||||||||
Net
sales
|
$
|
5,665.0
|
$
|
5,606.9
|
$
|
5,058.1
|
$
|
4,063.6
|
$
|
3,711.9
|
$
|
3,370.8
|
|||||||
Operating
earnings
|
$
|
341.2
|
$
|
468.7
|
$
|
394.8
|
$
|
223.5
|
$
|
197.4
|
$
|
191.1
|
|||||||
Earnings
before interest and taxes
|
$
|
354.2
|
$
|
524.1
|
$
|
408.4
|
$
|
233.6
|
$
|
200.7
|
$
|
179.5
|
|||||||
Earnings
before income taxes
|
$
|
309.7
|
$
|
485.9
|
$
|
373.3
|
$
|
204.0
|
$
|
162.4
|
$
|
132.2
|
|||||||
Earnings
from continuing operations
|
$
|
263.2
|
$
|
371.1
|
$
|
263.8
|
$
|
137.0
|
$
|
104.1
|
$
|
84.7
|
|||||||
Discontinued
operations:
|
|||||||||||||||||||
Earnings
(loss) from discontinued
operations,
net of tax (A)
|
(129.3
|
)
|
14.3
|
6.0
|
(1.8
|
)
|
(0.6
|
)
|
—
|
||||||||||
Cumulative
effect of changes in accounting
principle,
net of tax (B)
|
—
|
—
|
—
|
—
|
(25.1
|
)
|
(2.9
|
)
|
|||||||||||
Net
earnings
|
$
|
133.9
|
$
|
385.4
|
$
|
269.8
|
$
|
135.2
|
$
|
78.4
|
$
|
81.8
|
|||||||
Basic
earnings (loss) per common share:
|
|||||||||||||||||||
Earnings
from continuing operations before
accounting
change
|
$
|
2.80
|
$
|
3.80
|
$
|
2.76
|
$
|
1.50
|
$
|
1.16
|
$
|
0.96
|
|||||||
Discontinued
operations:
|
|||||||||||||||||||
Earnings
(loss) from discontinued
operations,
net of tax
|
(1.38
|
)
|
0.15
|
0.06
|
(0.02
|
)
|
(0.01
|
)
|
—
|
||||||||||
Cumulative
effect of changes in accounting
principle,
net of tax (B)
|
—
|
—
|
—
|
—
|
(0.28
|
)
|
(0.03
|
)
|
|||||||||||
Net
earnings
|
$
|
1.42
|
$
|
3.95
|
$
|
2.82
|
$
|
1.48
|
$
|
0.87
|
$
|
0.93
|
|||||||
Average
shares used for computation of
basic
earnings per share
|
94.0
|
97.6
|
95.6
|
91.2
|
90.0
|
87.8
|
|||||||||||||
Diluted
earnings (loss) per common share:
|
|||||||||||||||||||
Earnings
from continuing operations before
accounting
change
|
$
|
2.78
|
$
|
3.76
|
$
|
2.71
|
$
|
1.49
|
$
|
1.15
|
$
|
0.96
|
|||||||
Discontinued
operations:
|
|||||||||||||||||||
Earnings
(loss) from discontinued
operations,
net of tax
|
(1.37
|
)
|
0.14
|
0.06
|
(0.02
|
)
|
(0.01
|
)
|
—
|
||||||||||
Cumulative
effect of changes in accounting
principle,
net of tax (B)
|
—
|
—
|
—
|
—
|
(0.28
|
)
|
(0.03
|
)
|
|||||||||||
Net
earnings
|
$
|
1.41
|
$
|
3.90
|
$
|
2.77
|
$
|
1.47
|
$
|
0.86
|
$
|
0.93
|
|||||||
Average
shares used for computation of
diluted
earnings per share
|
94.7
|
98.8
|
97.3
|
91.9
|
90.7
|
88.1
|
(in
millions, except per share and other data)
|
2006
|
2005
|
2004
|
2003
|
2002
|
2001
|
|||||||||||||
Balance
sheet data
|
|||||||||||||||||||
Assets
of continuing operations
|
$
|
4,312.0
|
$
|
4,414.8
|
$
|
4,198.9
|
$
|
3,523.4
|
$
|
3,306.4
|
$
|
3,157.5
|
|||||||
Debt
Short-term
|
$
|
0.7
|
$
|
1.1
|
$
|
10.7
|
$
|
23.8
|
$
|
28.9
|
$
|
40.0
|
|||||||
Long-term
|
725.7
|
723.7
|
728.4
|
583.8
|
589.5
|
600.2
|
|||||||||||||
Total
debt
|
726.4
|
724.8
|
739.1
|
607.6
|
618.4
|
640.2
|
|||||||||||||
Common
shareholders’ equity (C)
|
1,871.8
|
1,978.8
|
1,712.3
|
1,323.0
|
1,101.8
|
1,110.9
|
|||||||||||||
Total
capitalization (C)
|
$
|
2,598.2
|
$
|
2,703.6
|
$
|
2,451.4
|
$
|
1,930.6
|
$
|
1,720.2
|
$
|
1,751.1
|
|||||||
Cash
flow data
Net
cash provided by operating activities of
continuing
operations
|
$
|
351.0
|
$
|
421.6
|
$
|
424.4
|
$
|
405.7
|
$
|
413.4
|
$
|
299.3
|
|||||||
Depreciation
and amortization
|
167.3
|
156.3
|
153.6
|
149.4
|
148.4
|
160.4
|
|||||||||||||
Capital
expenditures
|
205.1
|
223.8
|
163.8
|
157.7
|
112.6
|
111.4
|
|||||||||||||
Acquisitions
of businesses
|
86.2
|
130.3
|
248.2
|
140.0
|
16.4
|
134.4
|
|||||||||||||
Investments
|
(6.1
|
)
|
18.1
|
16.2
|
39.3
|
8.9
|
—
|
||||||||||||
Stock
repurchases
|
195.6
|
76.0
|
—
|
—
|
—
|
—
|
|||||||||||||
Cash
dividends paid
|
55.0
|
57.3
|
58.1
|
45.9
|
45.1
|
43.8
|
|||||||||||||
Other
data
Dividends
declared per share
|
$
|
0.60
|
$
|
0.60
|
$
|
0.60
|
$
|
0.50
|
$
|
0.50
|
$
|
0.50
|
|||||||
Book
value per share (C)
|
19.76
|
20.03
|
17.60
|
14.40
|
12.15
|
12.61
|
|||||||||||||
Return
on beginning shareholders’ equity
|
6.8
|
%
|
22.5
|
%
|
20.4
|
%
|
12.3
|
%
|
7.0
|
%
|
7.7
|
%
|
|||||||
Effective
tax rate (D)
|
21.6
|
%
|
22.3
|
%
|
28.7
|
%
|
32.8
|
%
|
36.0
|
%
|
36.0
|
%
|
|||||||
Debt-to-capitalization
rate (C)
|
28.0
|
%
|
26.8
|
%
|
30.2
|
%
|
31.5
|
%
|
35.9
|
%
|
36.6
|
%
|
|||||||
Number
of employees
|
28,000
|
26,500
|
24,745
|
22,525
|
20,815
|
20,700
|
|||||||||||||
Number
of shareholders of record
|
13,695
|
14,143
|
14,952
|
15,373
|
16,605
|
13,200
|
|||||||||||||
Common
stock price (NYSE)
High
|
$
|
42.30
|
$
|
49.50
|
$
|
49.85
|
$
|
32.08
|
$
|
30.01
|
$
|
25.01
|
|||||||
Low
|
27.56
|
35.09
|
31.25
|
16.35
|
18.30
|
14.03
|
|||||||||||||
Close
(last trading day)
|
31.90
|
40.66
|
49.50
|
31.83
|
19.86
|
21.76
|
•
|
Introducing
high-quality and reliable products with innovative and new technologies
in
all of Brunswick’s market segments;
|
•
|
Distributing
products through a model that benefits the Company’s dealers and
distributors by providing additional products and services that will
make
them more successful, improve the customer experience and, in turn,
make
Brunswick more successful;
|
•
|
Focusing
on cost reduction initiatives through global sourcing and realignment
of
Brunswick’s manufacturing operations and organizational
structure;
|
•
|
Continuing
to expand and enhance Brunswick’s global manufacturing footprint to
achieve best-cost positions; and
|
•
|
Acquiring
and investing in businesses that will expand and enhance Brunswick’s
product offerings, particularly in boats and parts &
accessories.
|
– |
The
continued rollout of Mercury Marine’s Verado, a family of supercharged
four-stroke outboard engines, into smaller naturally aspirated
four-cylinder models ranging from 135 to 175 horsepower, complementing
the
larger six-cylinder supercharged models, ranging from 200 to 300
horsepower;
|
– |
The
debut of single-cylinder 2.5 and 3.5 horsepower four-stroke outboard
engines, allowing Mercury Marine to offer a full line of four-stroke
engines from 2.5 horsepower through the 300 horsepower
Verado;
|
– |
Introduction
of two new direct-injected OptiMax two-stroke outboard engines with
250
and 300 horsepower;
|
– |
New
boat models across all boat divisions, many of which utilize Brunswick’s
High Performance Product Development (HPPD) process to integrate
the
design, engineering and manufacturing processes from start to
finish;
|
– |
New
cardiovascular and strength training fitness product offerings, including
the T5 and T7 treadmill series and the Summit Trainer, designed to
simplify and enhance the workout experience;
|
– |
Opening
of a state-of-the-art research and development lab in Life Fitness’
Franklin Park, Illinois, facility, which is being used to drive innovation
and future product improvements;
|
– |
Launch
of Vivo, Life Fitness’ new wireless connectivity technology that
integrates health clubs, fitness equipment, and exercisers to provide
a
more personalized workout experience by allowing users to record
workout
data and track progress toward their goals, and allowing health clubs
to
obtain enhanced data on usage and programs to better market them
to their
customers; and
|
– |
Continued
expansion of the larger Brunswick Zone XL family bowling entertainment
centers.
|
– |
Consolidation
of certain boat manufacturing facilities, sales offices and distribution
centers to streamline operations, including the transfer of Lund
Canada
production from Steinbach, Manitoba, Canada, to Lund’s New York Mills,
Minnesota, facility, and the transfer of a portion of US Marine’s Bayliner
production from one of its two Cumberland, Maryland, plants to its
operations in Pipestone, Minnesota;
|
– |
Streamlined
organizational structure across the Boat Group to advance the integration
of Brunswick’s marine operations and enhance the ability to achieve new
efficiencies and networking
competencies;
|
– |
Commenced
bowling ball manufacturing operations in Reynosa, Mexico, to which
the
transition from Muskegon, Michigan, will be completed in 2007;
and
|
– |
Announcement
of the relocation of Brunswick’s Valley-Dynamo manufacturing operations
from Richland Hills, Texas, to Reynosa, Mexico, where production
is
expected to commence in early- to mid-2007.
|
– |
Purchase
of Cabo Yachts, which complements the sportfishing convertibles offered
by
Brunswick’s Albemarle and Hatteras brands, the three of which now comprise
the Hatteras Collection;
|
– |
Acquisition
of Diversified Marine, which adds significant capacity to Brunswick’s
parts and accessories business and provides an essential distribution
hub
in the western United States; and
|
– |
Acquisition
of Blue Water Dealer Services, allowing Brunswick to offer a more
complete
line of financial services to its boat and marine engine dealers
and their
customers.
|
– |
Increased
investments in operations in Europe, the Pacific Rim and Latin America
supporting international sales, which now represent approximately
32
percent of net sales from continuing operations;
and
|
– |
Purchase
of an additional 13.3 percent of the outstanding stock of Protokon,
a
Hungarian fitness equipment manufacturer, which allows Brunswick
to better
service fitness customers in
Europe.
|
– |
Continued
purchases under a $500 million share repurchase program, buying back
approximately 5.6 million shares of Brunswick common stock for
approximately $196 million during 2006;
and
|
– |
Maintaining
an annual dividend payment of $0.60 per share.
|
Date
|
Description
|
Segment
|
||
2/28/05
|
Albemarle
Boats, Inc. (Albemarle)
|
Boat
|
||
5/27/05
|
Triton
Boat Company, L.P. (Triton)
|
Boat
|
||
6/20/05
|
Supra-Industria
Textil, Lda. (Valiant) - 51 percent
|
Marine
Engine
|
||
7/07/05
|
Kellogg
Marine, Inc. (Kellogg)
|
Boat
|
||
9/16/05
|
Harris
Kayot Marine, LLC (Harris Kayot)
|
Boat
|
||
2/16/06
|
Cabo
Yachts, Inc. (Cabo)
|
Boat
|
||
4/26/06
|
Diversified
Marine Products, L.P. (Diversified)
|
Boat
|
Date
|
Description
|
Segment
|
||
4/01/04
|
Lowe,
Lund, Crestliner
|
Boat
|
||
12/31/04
|
Sea
Pro, Sea Boss and Palmetto boats (Sea Pro)
|
Boat
|
||
2/28/05
|
Albemarle
Boats, Inc.
|
Boat
|
||
5/27/05
|
Triton
Boat Company, L.P.
|
Boat
|
||
6/20/05
|
Supra-Industria
Textil, Lda. - 51 percent
|
Marine
Engine
|
||
7/07/05
|
Kellogg
Marine, Inc.
|
Boat
|
||
9/16/05
|
Harris
Kayot Marine, LLC
|
Boat
|
|
2006
|
2005
|
2004
|
|||||||
Net
earnings from continuing operations per
diluted
share — as reported
|
$
|
2.78
|
$
|
3.76
|
$
|
2.71
|
||||
Tax
items
|
(0.50
|
)
|
(0.31
|
)
|
(0.10
|
)
|
||||
Investment
sale gain
|
—
|
(0.32
|
)
|
—
|
||||||
Net
earnings from continuing operations per
diluted
share — as adjusted
|
$
|
2.28
|
$
|
3.13
|
$
|
2.61
|
•
|
Tax
Items:
During 2006, the Company reduced its tax provision primarily due
to $47.0
million of tax benefits ($0.50 per diluted share), consisting of
$42.6
million of tax reserve reassessments of underlying exposures and
the
recognition of a $4.4 million interest receivable related to the
completion of IRS audits of prior taxable years. Refer to Note
10 - Commitments and Contingencies
in
the Notes to Consolidated Financial Statements for further detail.
|
In
2004, the Internal Revenue Service completed its routine audit of
tax
years 1998 through 2001. Following the completion of the examination
of
this four-year period, the Company reduced its tax reserves and,
consequently, its tax provision by $10.0 million ($0.10 per diluted
share).
|
•
|
Investment
Sale Gain:
On
February 23, 2005, the Company sold its investment of 1,861,200 shares
in
MarineMax, Inc. (MarineMax), its largest boat dealer, for $56.8 million,
net of $4.1 million of selling costs, which included $1.1 million
of
accrued expenses. The sale was made pursuant to a registered public
offering by MarineMax. As a result of this sale, the Company recorded
an
after-tax gain of $31.5 million ($0.32 per diluted share) after utilizing
previously unrecognized capital loss carryforwards.
|
2006
vs. 2005
Increase/(Decrease)
|
2005
vs. 2004
Increase/(Decrease)
|
|||||||||||||||||||||
2006
|
2005
|
2004
|
$
|
%
|
$
|
%
|
||||||||||||||||
(in
millions, except per share data)
|
||||||||||||||||||||||
Net
sales
|
$
|
5,665.0
|
$
|
5,606.9
|
$
|
5,058.1
|
$
|
58.1
|
1.0
|
%
|
$
|
548.8
|
10.9
|
%
|
||||||||
Gross
margin (A)
(C)
|
$
|
1,225.7
|
$
|
1,321.6
|
$
|
1,248.5
|
$
|
(95.9
|
)
|
(7.3
|
)%
|
$
|
73.1
|
5.9
|
%
|
|||||||
Operating
earnings (C)
|
$
|
341.2
|
$
|
468.7
|
$
|
394.8
|
$
|
(127.5
|
)
|
(27.2
|
)%
|
$
|
73.9
|
18.7
|
%
|
|||||||
Net
earnings
|
$
|
263.2
|
$
|
371.1
|
$
|
263.8
|
$
|
(107.9
|
)
|
(29.1
|
)%
|
$
|
107.3
|
40.7
|
%
|
|||||||
Diluted
earnings per share
|
$
|
2.78
|
$
|
3.76
|
$
|
2.71
|
$
|
(0.98
|
)
|
(26.1
|
)%
|
$
|
1.05
|
38.7
|
%
|
|||||||
Expressed
as a percentage of Net sales (B)
|
||||||||||||||||||||||
Gross
margin (C)
|
21.6
|
%
|
23.6
|
%
|
24.7
|
%
|
(200
|
)bpts |
(110
|
)bpts | ||||||||||||
Selling,
general and administrative expense
(C)
|
13.3
|
%
|
13.0
|
%
|
14.6
|
%
|
30
|
bpts |
(160
|
)bpts | ||||||||||||
Research
& development expense
|
2.3
|
%
|
2.2
|
%
|
2.3
|
%
|
10
|
bpts |
(10
|
)bpts | ||||||||||||
Operating
margin (C)
|
6.0
|
%
|
8.4
|
%
|
7.8
|
%
|
(240
|
)bpts |
60
|
bpts |
2006
vs. 2005
Increase(Decrease)
|
2005
vs. 2004
Increase/(Decrease)
|
|||||||||||||||||||||
2006
|
2005
|
2004
|
$
|
%
|
$
|
%
|
||||||||||||||||
(in
millions)
|
||||||||||||||||||||||
Net
sales
|
$
|
2,864.4
|
$
|
2,783.4
|
$
|
2,285.0
|
$
|
81.0
|
2.9
|
%
|
$
|
498.4
|
21.8
|
%
|
||||||||
Operating
earnings (A)
|
$
|
135.6
|
$
|
192.5
|
$
|
150.4
|
$
|
(56.9
|
)
|
(29.6
|
)%
|
$
|
42.1
|
28.0
|
%
|
|||||||
Operating
margin (A)
|
4.7
|
%
|
6.9
|
%
|
6.6
|
%
|
(220
|
)bpts |
30
|
bpts | ||||||||||||
Capital
expenditures
|
$
|
75.8
|
$
|
74.7
|
$
|
56.5
|
$
|
1.1
|
1.5
|
%
|
$
|
18.2
|
32.2
|
%
|
2006
vs. 2005 Increase/(Decrease) |
2005
vs. 2004
Increase/(Decrease)
|
|||||||||||||||||||||
2006
|
2005
|
2004
|
$
|
%
|
$
|
%
|
||||||||||||||||
(in
millions)
|
||||||||||||||||||||||
Net
sales
|
$
|
2,271.3
|
$
|
2,300.6
|
$
|
2,165.8
|
$
|
(29.3
|
)
|
(1.3
|
)%
|
$
|
134.8
|
6.2
|
%
|
|||||||
Operating
earnings (A)
|
$
|
193.8
|
$
|
250.5
|
$
|
237.2
|
$
|
(56.7
|
)
|
(22.6
|
)%
|
$
|
13.3
|
5.6
|
%
|
|||||||
Operating
margin (A)
|
8.5
|
%
|
10.9
|
%
|
11.0
|
%
|
(240
|
)bpts |
(10)
|
bpts | ||||||||||||
Capital
expenditures
|
$
|
72.5
|
$
|
91.5
|
$
|
68.7
|
$
|
(19.0
|
)
|
(20.8
|
)%
|
$
|
22.8
|
33.2
|
%
|
2006
vs. 2005
Increase/(Decrease)
|
2005
vs. 2004
Increase/(Decrease)
|
|||||||||||||||||||||
2006
|
2005
|
2004
|
$
|
%
|
$
|
%
|
||||||||||||||||
(in
millions)
|
||||||||||||||||||||||
Net
sales
|
$
|
593.1
|
$
|
551.4
|
$
|
558.8
|
$
|
41.7
|
7.6
|
%
|
$
|
(7.4
|
)
|
(1.3
|
)%
|
|||||||
Operating
earnings
|
$
|
57.8
|
$
|
56.1
|
$
|
44.2
|
$
|
1.7
|
3.0
|
%
|
$
|
11.9
|
26.9
|
%
|
||||||||
Operating
margin
|
9.7
|
%
|
10.2
|
%
|
7.9
|
%
|
(50
|
)bpts |
230
|
bpts | ||||||||||||
Capital
expenditures
|
$
|
11.0
|
$
|
11.2
|
$
|
8.3
|
$
|
(0.2
|
)
|
(1.8
|
)%
|
$
|
2.9
|
34.9
|
%
|
2006
vs. 2005
Increase/(Decrease)
|
2005
vs. 2004
Increase/(Decrease)
|
|||||||||||||||||||||
2006
|
2005
|
2004
|
$
|
%
|
$
|
%
|
||||||||||||||||
(in
millions)
|
||||||||||||||||||||||
Net
sales
|
$
|
458.3
|
$
|
464.5
|
$
|
442.4
|
$
|
(6.2
|
)
|
(1.3
|
)%
|
$
|
22.1
|
5.0
|
%
|
|||||||
Operating
earnings (A)
|
$
|
22.1
|
$
|
37.2
|
$
|
41.7
|
$
|
(15.1
|
)
|
(40.6
|
)%
|
$
|
(4.5
|
)
|
(10.8
|
)%
|
||||||
Operating
margin (A)
|
4.8
|
%
|
8.0
|
%
|
9.4
|
%
|
(320
|
)bpts |
(140)
|
bpts | ||||||||||||
Capital
expenditures
|
$
|
43.7
|
$
|
36.8
|
$
|
27.7
|
$
|
6.9
|
18.8
|
%
|
$
|
9.1
|
32.9
|
%
|
2006
|
2005
|
2004
|
||||||||
(in
millions)
|
||||||||||
Net
cash provided by operating activities of continuing
operations
|
$
|
351.0
|
$
|
421.6
|
$
|
424.4
|
||||
Net
cash provided by (used for):
|
||||||||||
Capital
expenditures
|
(205.1
|
)
|
(223.8
|
)
|
(163.8
|
)
|
||||
Proceeds
from investment sale
|
—
|
57.9
|
—
|
|||||||
Proceeds
from the sale of property, plant and equipment
|
7.2
|
13.4
|
13.4
|
|||||||
Other,
net
|
(0.4
|
)
|
(1.2
|
)
|
2.0
|
|||||
Free
cash flow from continuing operations *
|
$
|
152.7
|
$
|
267.9
|
$
|
276.0
|
Payments
due by period
|
||||||||||||||||
(in
millions)
|
Total
|
Less
than
1
year
|
1-3
years
|
3-5
years
|
More
than
5
years
|
|||||||||||
Contractual
Obligations
|
||||||||||||||||
Short-term
debt (1)
|
$
|
—
|
$
|
—
|
$
|
—
|
$
|
—
|
$
|
—
|
||||||
Long-term
debt (1)
|
726.4
|
0.7
|
251.6
|
149.8
|
324.3
|
|||||||||||
Interest
payments on long-term debt
|
520.2
|
46.0
|
84.1
|
57.5
|
332.6
|
|||||||||||
Operating
leases (2)
|
186.6
|
42.9
|
61.5
|
39.7
|
42.5
|
|||||||||||
Purchase
obligations (3)
|
234.1
|
228.5
|
2.7
|
2.6
|
0.3
|
|||||||||||
Deferred
pension liability (4)
|
55.6
|
3.0
|
5.9
|
5.9
|
40.8
|
|||||||||||
Deferred
management compensation (5)
|
84.5
|
4.2
|
11.8
|
15.3
|
53.2
|
|||||||||||
Other
long-term liabilities (6)
|
158.7
|
64.6
|
71.9
|
14.8
|
7.4
|
|||||||||||
Total
contractual obligations
|
$
|
1,966.1
|
$
|
389.9
|
$
|
489.5
|
$
|
285.6
|
$
|
801.1
|
(in
millions)
|
2006
|
2005
|
|||||
Risk
Category
|
|||||||
Foreign
exchange
|
$
|
34.3
|
$
|
35.9
|
|||
Interest
rates
|
$
|
1.0
|
$
|
6.2
|
|||
Commodity
prices
|
$
|
2.2
|
$
|
1.2
|
|
Page
|
Financial
Statements:
|
|
Report
of Management on Internal Control over Financial Reporting
|
44
|
Report
of Independent Registered Public Accounting Firm on Internal Control
over
Financial Reporting
|
45
|
Report
of Independent Registered Public Accounting Firm
|
46
|
Consolidated
Statements of Income for the Years Ended December 31, 2006, 2005
and
2004
|
47
|
Consolidated
Balance Sheets as of December 31, 2006 and 2005
|
48
|
Consolidated
Statements of Cash Flows for the Years Ended December 31, 2006, 2005
and
2004
|
50
|
Consolidated
Statements of Shareholders’ Equity for the Years Ended December 31, 2006,
2005 and 2004
|
51
|
Notes
to Consolidated Financial Statements
|
52
|
Financial
Statement Schedule:
|
|
Schedule
II - Valuation and Qualifying Accounts
|
86
|
/s/ DUSTAN E. McCOY | /s/ PETER G. LEEMPUTTE |
Dustan
E. McCoy
Chairman
and Chief Executive Officer
|
Peter
G. Leemputte
Senior
Vice President and Chief Financial
Officer
|
BRUNSWICK
CORPORATION
|
Consolidated
Statements of Income
|
For
the Years Ended December 31
|
||||||||||
2006
|
2005
|
2004
|
||||||||
(in
millions, except per share data)
|
||||||||||
Net
sales
|
$
|
5,665.0
|
$
|
5,606.9
|
$
|
5,058.1
|
||||
Cost
of sales
|
4,439.3
|
4,285.3
|
3,809.6
|
|||||||
Selling,
general and administrative expense
|
752.3
|
729.4
|
736.9
|
|||||||
Research
and development expense
|
132.2
|
123.5
|
116.8
|
|||||||
Operating
earnings
|
341.2
|
468.7
|
394.8
|
|||||||
Equity
earnings
|
14.9
|
18.1
|
18.1
|
|||||||
Investment
sale gain
|
-
|
38.7
|
-
|
|||||||
Other
expense, net
|
(1.9
|
)
|
(1.4
|
)
|
(4.5
|
)
|
||||
Earnings
before interest and income taxes
|
354.2
|
524.1
|
408.4
|
|||||||
Interest
expense
|
(60.5
|
)
|
(53.2
|
)
|
(45.2
|
)
|
||||
Interest
income
|
16.0
|
15.0
|
10.1
|
|||||||
Earnings
before income taxes
|
309.7
|
485.9
|
373.3
|
|||||||
Income
tax provision
|
46.5
|
114.8
|
109.5
|
|||||||
Net
earnings from continuing operations
|
263.2
|
371.1
|
263.8
|
|||||||
Discontinued
operations:
|
||||||||||
Earnings
(loss) from discontinued operations, net of tax
|
(43.7
|
)
|
14.3
|
6.0
|
||||||
Impairment
charges on assets held for sale, net of tax
|
(85.6
|
)
|
-
|
-
|
||||||
Net
earnings (loss) from discontinued
operations,
net of tax
|
(129.3
|
)
|
14.3
|
6.0
|
||||||
Net
earnings
|
$
|
133.9
|
$
|
385.4
|
$
|
269.8
|
||||
Earnings
per common share:
|
||||||||||
Basic
|
||||||||||
Earnings
from continuing operations
|
$
|
2.80
|
$
|
3.80
|
$
|
2.76
|
||||
Earnings
(loss) from discontinued operations
|
(1.38
|
)
|
0.15
|
0.06
|
||||||
Net
earnings
|
$
|
1.42
|
$
|
3.95
|
$
|
2.82
|
||||
Diluted
|
||||||||||
Earnings
from continuing operations
|
$
|
2.78
|
$
|
3.76
|
$
|
2.71
|
||||
Earnings
(loss) from discontinued operations
|
(1.37
|
)
|
0.14
|
0.06
|
||||||
Net
earnings
|
$
|
1.41
|
$
|
3.90
|
$
|
2.77
|
||||
Weighted
average shares used for computation of:
|
||||||||||
Basic
earnings per share
|
94.0
|
97.6
|
95.6
|
|||||||
Diluted
earnings per share
|
94.7
|
98.8
|
97.3
|
|||||||
Cash
dividends declared per common share
|
$
|
0.60
|
$
|
0.60
|
$
|
0.60
|
||||
The
Notes to Consolidated Financial Statements are an integral part of
these
consolidated statements.
|
BRUNSWICK
CORPORATION
|
Consolidated
Balance Sheets
|
As
of December 31
|
|||||||
2006
|
2005
|
||||||
(in
millions)
|
|||||||
Assets
|
|||||||
Current
assets
|
|||||||
Cash
and cash equivalents, at cost, which approximates market
|
$
|
283.4
|
$
|
487.7
|
|||
Accounts
and notes receivable, less allowances of $29.7 and $22.1
|
492.3
|
471.6
|
|||||
Inventories
|
|
|
|||||
Finished
goods
|
410.4
|
384.3
|
|||||
Work-in-process
|
308.4
|
298.5
|
|||||
Raw
materials
|
143.1
|
134.1
|
|||||
Net
inventories
|
861.9
|
816.9
|
|||||
Deferred
income taxes
|
249.9
|
274.8
|
|||||
Prepaid
expenses and other
|
85.4
|
70.3
|
|||||
Current
assets held for sale
|
105.5
|
113.7
|
|||||
Current
assets
|
2,078.4
|
2,235.0
|
|||||
Property
|
|||||||
Land
|
91.7
|
76.7
|
|||||
Buildings
and improvements
|
631.6
|
603.2
|
|||||
Equipment
|
1,181.7
|
1,111.2
|
|||||
Total
land, buildings and improvements and equipment
|
1,905.0
|
1,791.1
|
|||||
Accumulated
depreciation
|
(1,046.3
|
)
|
(987.6
|
)
|
|||
Net
land, buildings and improvements and equipment
|
858.7
|
803.5
|
|||||
Unamortized
product tooling costs
|
156.2
|
149.8
|
|||||
Net
property
|
1,014.9
|
953.3
|
|||||
Other
assets
|
|||||||
Goodwill
|
663.6
|
617.3
|
|||||
Other
intangibles
|
322.6
|
331.9
|
|||||
Investments
|
142.9
|
141.4
|
|||||
Other
long-term assets
|
195.1
|
249.6
|
|||||
Long-term
assets held for sale
|
32.8
|
93.0
|
|||||
Other
assets
|
1,357.0
|
1,433.2
|
|||||
Total
assets
|
$
|
4,450.3
|
$
|
4,621.5
|
|||
The
Notes to Consolidated Financial Statements are an integral part of
these
consolidated statements.
|
BRUNSWICK
CORPORATION
|
Consolidated
Balance Sheets
|
As
of December 31
|
|||||||
2006
|
2005
|
||||||
(in
millions, except share data)
|
|||||||
Liabilities
and shareholders’ equity
|
|||||||
Current
liabilities
|
|||||||
Short-term
debt, including current maturities of long-term debt
|
$
|
0.7
|
$
|
1.1
|
|||
Accounts
payable
|
448.6
|
431.7
|
|||||
Accrued
expenses
|
748.9
|
803.8
|
|||||
Current
liabilities held for sale
|
95.0
|
68.6
|
|||||
Current
liabilities
|
1,293.2
|
1,305.2
|
|||||
Long-term
liabilities
|
|||||||
Debt
|
725.7
|
723.7
|
|||||
Deferred
income taxes
|
86.3
|
147.5
|
|||||
Postretirement
and postemployment benefits
|
224.2
|
215.6
|
|||||
Other
|
240.4
|
245.0
|
|||||
Long-term
liabilities held for sale
|
8.7
|
5.7
|
|||||
Long-term
liabilities
|
1,285.3
|
1,337.5
|
|||||
Shareholders’
equity
|
|||||||
Common
stock; authorized: 200,000,000 shares,
$0.75
par value; issued: 102,538,000 shares
|
76.9
|
76.9
|
|||||
Additional
paid-in capital
|
378.7
|
368.3
|
|||||
Retained
earnings
|
1,820.7
|
1,741.8
|
|||||
Treasury
stock, at cost: 11,671,000 and 6,881,000 shares
|
(315.5
|
)
|
(136.0
|
)
|
|||
Unearned
compensation and other
|
-
|
(6.1
|
)
|
||||
Accumulated
other comprehensive income (loss), net of tax:
|
|||||||
Foreign
currency translation
|
38.8
|
14.1
|
|||||
Defined
benefit plans:
|
|||||||
Prior
service costs
|
(11.2
|
)
|
-
|
||||
Net
actuarial losses
|
(121.7
|
)
|
-
|
||||
Minimum
pension liability
|
-
|
(88.0
|
)
|
||||
Unrealized
investment losses
|
(0.2
|
)
|
(0.1
|
)
|
|||
Unrealized
gains on derivatives
|
5.3
|
7.9
|
|||||
Total
accumulated other comprehensive loss
|
(89.0
|
)
|
(66.1
|
)
|
|||
Shareholders’
equity
|
1,871.8
|
1,978.8
|
|||||
Total
liabilities and shareholders’ equity
|
$
|
4,450.3
|
$
|
4,621.5
|
|||
The
Notes to Consolidated Financial Statements are an integral part
of these
consolidated statements.
|
BRUNSWICK
CORPORATION
|
Consolidated
Statements of Cash Flows
|
For
the Years Ended December 31
|
||||||||||
2006
|
2005
|
2004
|
||||||||
(in
millions)
|
||||||||||
Cash
flows from operating activities
|
||||||||||
Net
earnings from continuing operations
|
$
|
263.2
|
$
|
371.1
|
$
|
263.8
|
||||
Depreciation
and amortization
|
167.3
|
156.3
|
153.6
|
|||||||
Changes
in noncash current assets and current liabilities
|
|
|
|
|||||||
Change
in accounts and notes receivable
|
(4.3
|
)
|
(9.5
|
)
|
(72.0
|
)
|
||||
Change
in inventory
|
(28.7
|
)
|
(22.8
|
)
|
(103.9
|
)
|
||||
Change
in prepaid expenses and other
|
0.8
|
0.9
|
7.7
|
|||||||
Change
in accounts payable
|
9.5
|
29.7
|
40.3
|
|||||||
Change
in accrued expenses
|
(70.1
|
)
|
(51.9
|
)
|
74.5
|
|||||
Income
taxes
|
(25.5
|
)
|
(3.1
|
)
|
50.1
|
|||||
Other,
net
|
38.8
|
(49.1
|
)
|
10.3
|
||||||
Net
cash provided by operating activities
of
continuing operations
|
351.0
|
421.6
|
424.4
|
|||||||
Net
cash (used for) provided by operating
activities
of discontinued operations
|
(35.7
|
)
|
11.3
|
(9.2
|
)
|
|||||
Net
cash provided by operating activities
|
315.3
|
432.9
|
415.2
|
|||||||
Cash
flows from investing activities
|
||||||||||
Capital
expenditures
|
(205.1
|
)
|
(223.8
|
)
|
(163.8
|
)
|
||||
Acquisitions
of businesses, net of cash acquired
|
(86.2
|
)
|
(130.3
|
)
|
(248.2
|
)
|
||||
Investments
|
6.1
|
(18.1
|
)
|
(16.2
|
)
|
|||||
Proceeds
from investment sale
|
-
|
57.9
|
-
|
|||||||
Proceeds
from the sale of property, plant and equipment
|
7.2
|
13.4
|
13.4
|
|||||||
Other,
net
|
(0.4
|
)
|
(1.2
|
)
|
2.0
|
|||||
Net
cash used for investing activities
of
continuing operations
|
(278.4
|
)
|
(302.1
|
)
|
(412.8
|
)
|
||||
Net
cash used for investing activities
of
discontinued operations
|
(5.5
|
)
|
(20.7
|
)
|
(27.1
|
)
|
||||
Net
cash used for investing activities
|
(283.9
|
)
|
(322.8
|
)
|
(439.9
|
)
|
||||
|
||||||||||
Cash
flows from financing activities
|
||||||||||
Net
repayments of short-term debt
|
(0.2
|
)
|
(0.6
|
)
|
(8.8
|
)
|
||||
Net
proceeds from issuance of long-term debt
|
250.3
|
1.3
|
152.3
|
|||||||
Payments
of long-term debt including current maturities
|
(251.1
|
)
|
(6.7
|
)
|
(6.3
|
)
|
||||
Cash
dividends paid
|
(55.0
|
)
|
(57.3
|
)
|
(58.1
|
)
|
||||
Stock
repurchases
|
(195.6
|
)
|
(76.0
|
)
|
-
|
|||||
Stock
options exercised
|
15.9
|
17.1
|
99.5
|
|||||||
Net
cash (used for) provided by financing activities
of
continuing operations
|
(235.7
|
)
|
(122.2
|
)
|
178.6
|
|||||
Net
cash (used for) provided by financing activities
of
discontinued operations
|
-
|
-
|
-
|
|||||||
Net
cash (used for) provided by financing activities
|
(235.7
|
)
|
(122.2
|
)
|
178.6
|
|||||
Net
(decrease) increase in cash and cash equivalents
|
(204.3
|
)
|
(12.1
|
)
|
153.9
|
|||||
Cash
and cash equivalents at January 1
|
487.7
|
499.8
|
345.9
|
|||||||
Cash
and cash equivalents at December 31
|
$
|
283.4
|
$
|
487.7
|
$
|
499.8
|
||||
Supplemental
cash flow disclosures:
|
||||||||||
Interest
paid
|
$
|
61.2
|
$
|
54.6
|
$
|
46.0
|
||||
Income
taxes paid, net
|
$
|
72.0
|
$
|
113.4
|
$
|
58.5
|
The
Notes to Consolidated Financial Statements are an integral part of
these
consolidated statements.
|
BRUNSWICK
CORPORATION
|
Consolidated
Statements of Shareholders’
Equity
|
Common
Stock
|
Additional
Paid-in
Capital
|
Retained
Earnings
|
Treasury
Stock
|
Unearned
Compensation
and
Other
|
Accumulated
Other
Comprehensive
Income
(Loss)
|
Total
|
||||||||||||||||
(in
millions, except per share data)
|
||||||||||||||||||||||
Balance,
December 31, 2003
|
$
|
76.9
|
$
|
310.0
|
$
|
1,202.0
|
$
|
(183.6
|
)
|
$
|
(10.1
|
)
|
$
|
(72.2
|
)
|
$
|
1,323.0
|
|||||
Comprehensive
income (loss)
Net
earnings
|
—
|
—
|
269.8
|
—
|
—
|
—
|
269.8
|
|||||||||||||||
Foreign
currency translation
adjustments,
net of tax
|
—
|
—
|
—
|
—
|
—
|
22.7
|
22.7
|
|||||||||||||||
Unrealized
investment gains, net of tax
|
—
|
—
|
—
|
—
|
—
|
11.8
|
11.8
|
|||||||||||||||
Unrealized
losses on derivatives, net of tax
|
—
|
—
|
—
|
—
|
—
|
(9.6
|
)
|
(9.6
|
)
|
|||||||||||||
Minimum
pension liability
adjustment,
net of tax
|
—
|
—
|
—
|
—
|
—
|
(7.0
|
)
|
(7.0
|
)
|
|||||||||||||
Total
comprehensive income —
2004
|
—
|
—
|
269.8
|
—
|
—
|
17.9
|
287.7
|
|||||||||||||||
Dividends
($0.60 per common share)
|
—
|
—
|
(58.1
|
)
|
—
|
—
|
—
|
(58.1
|
)
|
|||||||||||||
Common
stock issued for Navman acquisition
|
—
|
7.2
|
—
|
9.4
|
—
|
—
|
16.6
|
|||||||||||||||
Tax
benefit relating to stock options
|
—
|
28.4
|
—
|
—
|
—
|
—
|
28.4
|
|||||||||||||||
Compensation
plans and other
|
—
|
13.2
|
—
|
97.7
|
3.8
|
—
|
114.7
|
|||||||||||||||
Balance,
December 31, 2004
|
$
|
76.9
|
$
|
358.8
|
$
|
1,413.7
|
$
|
(76.5
|
)
|
$
|
(6.3
|
)
|
$
|
(54.3
|
)
|
$
|
1,712.3
|
|||||
Comprehensive
income (loss)
Net
earnings
|
—
|
—
|
385.4
|
—
|
—
|
—
|
385.4
|
|||||||||||||||
Foreign
currency translation
adjustments,
net of tax
|
—
|
—
|
—
|
—
|
—
|
(18.1
|
)
|
(18.1
|
)
|
|||||||||||||
Realized
gain from investment sale, net of tax
|
—
|
—
|
—
|
—
|
—
|
(24.2
|
)
|
(24.2
|
)
|
|||||||||||||
Unrealized
investment gains, net of tax
|
—
|
—
|
—
|
—
|
—
|
0.9
|
0.9
|
|||||||||||||||
Unrealized
gains on derivatives, net of tax
|
—
|
—
|
—
|
—
|
—
|
19.9
|
19.9
|
|||||||||||||||
Minimum
pension liability
adjustment,
net of tax
|
—
|
—
|
—
|
—
|
—
|
9.7
|
9.7
|
|||||||||||||||
Total
comprehensive income (loss) —
2005
|
—
|
—
|
385.4
|
—
|
—
|
(11.8
|
)
|
373.6
|
||||||||||||||
Dividends
($0.60 per common share)
|
—
|
—
|
(57.3
|
)
|
—
|
—
|
—
|
(57.3
|
)
|
|||||||||||||
Common
stock repurchase program
|
—
|
—
|
—
|
(76.0
|
)
|
—
|
—
|
(76.0
|
)
|
|||||||||||||
Tax
benefit relating to stock options
|
—
|
5.6
|
—
|
—
|
—
|
—
|
5.6
|
|||||||||||||||
Compensation
plans and other
|
—
|
3.9
|
—
|
16.5
|
0.2
|
—
|
20.6
|
|||||||||||||||
Balance,
December 31, 2005
|
$
|
76.9
|
$
|
368.3
|
$
|
1,741.8
|
$
|
(136.0
|
)
|
$
|
(6.1
|
)
|
$
|
(66.1
|
)
|
$
|
1,978.8
|
|||||
Comprehensive
income (loss)
Net
earnings
|
—
|
—
|
133.9
|
—
|
—
|
—
|
133.9
|
|||||||||||||||
Foreign
currency translation
adjustments,
net of tax
|
—
|
—
|
—
|
—
|
—
|
24.7
|
24.7
|
|||||||||||||||
Unrealized
investment losses, net of tax
|
—
|
—
|
—
|
—
|
—
|
(0.1
|
)
|
(0.1
|
)
|
|||||||||||||
Unrealized
losses on derivatives, net of tax
|
—
|
—
|
—
|
—
|
—
|
(2.6
|
)
|
(2.6
|
)
|
|||||||||||||
Minimum
pension liability
adjustment,
net of tax
|
—
|
—
|
—
|
—
|
—
|
15.8
|
15.8
|
|||||||||||||||
Total
comprehensive income —
2006
|
—
|
—
|
133.9
|
—
|
—
|
37.8
|
171.7
|
|||||||||||||||
Adjustment
to initially apply FASB
Statement
No. 158, net of tax
|
—
|
—
|
—
|
—
|
—
|
(60.7
|
)
|
(60.7
|
)
|
|||||||||||||
Dividends
($0.60 per common share)
|
—
|
—
|
(55.0
|
)
|
—
|
—
|
—
|
(55.0
|
)
|
|||||||||||||
Common
stock repurchase program
|
—
|
—
|
—
|
(195.6
|
)
|
—
|
—
|
(195.6
|
)
|
|||||||||||||
Tax
benefit relating to stock options
|
—
|
2.9
|
—
|
—
|
—
|
—
|
2.9
|
|||||||||||||||
Reclassification
adjustment to initially apply
FASB
Statement No. 123(R)
|
—
|
(6.1
|
)
|
—
|
—
|
6.1
|
—
|
—
|
||||||||||||||
Compensation
plans and other
|
—
|
13.6
|
—
|
16.1
|
—
|
—
|
29.7
|
|||||||||||||||
Balance,
December 31, 2006
|
$
|
76.9
|
$
|
378.7
|
$
|
1,820.7
|
$
|
(315.5
|
)
|
$
|
—
|
$
|
(89.0
|
)
|
$
|
1,871.8
|
The
Notes to Consolidated Financial Statements are an integral part
of these
consolidated statements.
|
– |
The
reported amounts of assets and liabilities;
|
– |
The
disclosure of contingent assets and liabilities at the date of the
financial statements; and
|
– |
The
reported amounts of revenues and expenses during the reporting
periods.
|
– |
Allowances
for doubtful accounts;
|
– |
Inventory
valuation reserves;
|
– |
Reserves
for dealer allowances;
|
– |
Warranty
related reserves;
|
– |
Losses
on litigation and other contingencies;
|
– |
Environmental
reserves;
|
– |
Insurance
reserves;
|
– |
Income
tax reserves;
|
– |
Reserves
related to restructuring activities; and
|
– |
Pension,
postretirement and postemployment
liabilities.
|
2006
|
2005
|
2004
|
||||||||
(in
millions)
|
||||||||||
Gains
on the sale of property
|
$
|
3.3
|
$
|
7.1
|
$
|
4.1
|
||||
Losses
on the sale of property
|
(2.2
|
)
|
(2.2
|
)
|
(4.7
|
)
|
||||
Net
gains (losses) on sale of property
|
$
|
1.1
|
$
|
4.9
|
$
|
(0.6
|
)
|
December
31,
|
December
31,
|
||||||||||||
2005
|
Acquisitions
|
Adjustments
|
2006
|
||||||||||
(in
millions)
|
|||||||||||||
Boat
|
$
|
317.0
|
$
|
28.8
|
$
|
16.2
|
$
|
362.0
|
|||||
Marine
Engine
|
19.9
|
—
|
(5.2
|
)
|
14.7
|
||||||||
Fitness
|
265.9
|
3.9
|
2.5
|
272.3
|
|||||||||
Bowling
& Billiards
|
14.5
|
—
|
0.1
|
14.6
|
|||||||||
Total
|
$
|
617.3
|
$
|
32.7
|
$
|
13.6
|
$
|
663.6
|
December
31,
|
December
31,
|
||||||||||||
2004
|
Acquisitions
|
Adjustments
|
2005
|
||||||||||
(in
millions)
|
|||||||||||||
Boat
|
$
|
288.5
|
$
|
31.9
|
$
|
(3.4
|
)
|
$
|
317.0
|
||||
Marine
Engine
|
11.7
|
8.5
|
(0.3
|
)
|
19.9
|
||||||||
Fitness
|
267.4
|
—
|
(1.5
|
)
|
265.9
|
||||||||
Bowling
& Billiards
|
13.3
|
1.2
|
—
|
14.5
|
|||||||||
Total
|
$
|
580.9
|
$
|
41.6
|
$
|
(5.2
|
)
|
$
|
617.3
|
December
31, 2006
|
December
31, 2005
|
||||||||||||
Gross
Amount
|
Accumulated
Amortization
|
Gross
Amount
|
Accumulated
Amortization
|
||||||||||
(in
millions)
|
|||||||||||||
Amortized
intangible assets:
|
|||||||||||||
Customer
relationships
|
$
|
271.6
|
$
|
(202.9
|
)
|
$
|
259.0
|
$
|
(193.9
|
)
|
|||
Other
|
38.7
|
(15.7
|
)
|
34.0
|
(10.0
|
)
|
|||||||
Total
|
$
|
310.3
|
$
|
(218.6
|
)
|
$
|
293.0
|
$
|
(203.9
|
)
|
|||
Indefinite-lived
intangible assets:
|
|||||||||||||
Trademarks/tradenames
|
$
|
248.2
|
$
|
(17.3
|
)
|
$
|
225.6
|
$
|
(17.2
|
)
|
|||
Pension
intangible asset
|
—
|
—
|
34.4
|
—
|
|||||||||
Total
|
$
|
248.2
|
$
|
(17.3
|
)
|
$
|
260.0
|
$
|
(17.2
|
)
|
2006
|
2005
|
2004
|
||||||||
(in
millions)
|
||||||||||
Net
sales
|
$
|
306.3
|
$
|
325.0
|
$
|
173.6
|
||||
Pre-tax
earnings (loss) (A)
|
$
|
(138.9
|
)
|
$
|
9.9
|
$
|
5.2
|
December
31,
2006
|
December
31,
2005
|
||||||
(in
millions)
|
|||||||
Accounts
receivable
|
$
|
51.5
|
$
|
50.8
|
|||
Inventory
|
52.5
|
57.7
|
|||||
Other
current assets
|
1.5
|
5.2
|
|||||
Total
current assets
|
105.5
|
113.7
|
|||||
Goodwill
and intangible assets
|
19.8
|
74.0
|
|||||
Investments
|
6.1
|
2.2
|
|||||
Property,
plant and equipment
|
6.9
|
16.8
|
|||||
Total
assets
|
138.3
|
206.7
|
|||||
Accounts
payable
|
46.4
|
40.5
|
|||||
Accrued
expenses
|
48.6
|
28.1
|
|||||
Total
current liabilities
|
95.0
|
68.6
|
|||||
Long-term
liabilities
|
8.7
|
5.7
|
|||||
Total
liabilities
|
103.7
|
74.3
|
|||||
Net
assets
|
$
|
34.6
|
$
|
132.4
|
Boat
Segment
|
Marine
Engine
Segment
|
Fitness
Segment
|
Bowling
&
Billiards
Segment
|
Corporate
|
Total
|
||||||||||||||
(in
millions)
|
|||||||||||||||||||
Cost
of sales:
|
|||||||||||||||||||
Severance
|
$
|
0.6
|
$
|
3.0
|
$
|
—
|
$
|
0.9
|
$
|
—
|
$
|
4.5
|
|||||||
Asset
write-downs
|
0.5
|
—
|
—
|
—
|
—
|
0.5
|
|||||||||||||
Other
|
0.3
|
2.3
|
—
|
—
|
—
|
2.6
|
|||||||||||||
Total
|
1.4
|
5.3
|
—
|
0.9
|
—
|
7.6
|
|||||||||||||
Selling,
general and administrative
expense:
|
|||||||||||||||||||
Severance
|
1.5
|
3.2
|
—
|
0.5
|
0.7
|
5.9
|
|||||||||||||
Asset
write-downs
|
0.4
|
0.9
|
—
|
1.3
|
—
|
2.6
|
|||||||||||||
Other
|
0.9
|
0.1
|
—
|
—
|
—
|
1.0
|
|||||||||||||
Total
|
2.8
|
4.2
|
—
|
1.8
|
0.7
|
9.5
|
|||||||||||||
Equity
earnings:
|
|||||||||||||||||||
Asset
write-downs
|
—
|
—
|
—
|
1.8
|
—
|
1.8
|
|||||||||||||
Total
restructuring charges
|
$
|
4.2
|
$
|
9.5
|
$
|
—
|
$
|
4.5
|
$
|
0.7
|
$
|
18.9
|
2006
|
2005
|
2004
|
||||||||
(in
millions, except per share data)
|
||||||||||
Net
earnings from continuing operations
|
$
|
263.2
|
$
|
371.1
|
$
|
263.8
|
||||
Net
earnings (loss) from discontinued operations,
net
of tax
|
(129.3
|
)
|
14.3
|
6.0
|
||||||
Net
earnings
|
$
|
133.9
|
$
|
385.4
|
$
|
269.8
|
||||
Average
outstanding shares - basic
|
94.0
|
97.6
|
95.6
|
|||||||
Dilutive
effect of common stock equivalents
|
0.7
|
1.2
|
1.7
|
|||||||
Average
outstanding shares - diluted
|
94.7
|
98.8
|
97.3
|
|||||||
Basic
earnings (loss) per share
|
||||||||||
Continuing
operations
|
$
|
2.80
|
$
|
3.80
|
$
|
2.76
|
||||
Discontinued
operations
|
(1.38
|
)
|
0.15
|
0.06
|
||||||
Net
earnings
|
$
|
1.42
|
$
|
3.95
|
$
|
2.82
|
||||
Diluted
earnings (loss) per share
|
||||||||||
Continuing
operations
|
$
|
2.78
|
$
|
3.76
|
$
|
2.71
|
||||
Discontinued
operations
|
(1.37
|
)
|
0.14
|
0.06
|
||||||
Net
earnings
|
$
|
1.41
|
$
|
3.90
|
$
|
2.77
|
Net
Sales
|
Operating
Earnings
|
Total
Assets
|
|||||||||||||||||||||||
2006
|
2005
|
2004
|
2006
|
2005
|
2004
|
2006
|
2005
|
||||||||||||||||||
(in
millions)
|
|||||||||||||||||||||||||
Boat
|
$
|
2,864.4
|
$
|
2,783.4
|
$
|
2,285.0
|
$
|
135.6
|
$
|
192.5
|
$
|
150.4
|
$
|
1,540.4
|
$
|
1,358.9
|
|||||||||
Marine
Engine
|
2,271.3
|
2,300.6
|
2,165.8
|
193.8
|
250.5
|
237.2
|
894.8
|
934.2
|
|||||||||||||||||
Marine
eliminations
|
(521.8
|
)
|
(491.6
|
)
|
(390.4
|
)
|
—
|
—
|
0.1
|
—
|
—
|
||||||||||||||
Total
Marine
|
4,613.9
|
4,592.4
|
4,060.4
|
329.4
|
443.0
|
387.7
|
2,435.2
|
2,293.1
|
|||||||||||||||||
Fitness
|
593.1
|
551.4
|
558.8
|
57.8
|
56.1
|
44.2
|
693.1
|
678.5
|
|||||||||||||||||
Bowling
& Billiards
|
458.3
|
464.5
|
442.4
|
22.1
|
37.2
|
41.7
|
392.2
|
386.5
|
|||||||||||||||||
Eliminations
|
(0.3
|
)
|
(1.4
|
)
|
(3.5
|
)
|
—
|
—
|
(0.1
|
)
|
—
|
—
|
|||||||||||||
Corporate/Other
|
—
|
—
|
—
|
(68.1
|
)
|
(67.6
|
)
|
(78.7
|
)
|
791.5
|
1,056.7
|
||||||||||||||
Total
|
$
|
5,665.0
|
$
|
5,606.9
|
$
|
5,058.1
|
$
|
341.2
|
$
|
468.7
|
$
|
394.8
|
$
|
4,312.0
|
$
|
4,414.8
|
Depreciation
|
Amortization
|
||||||||||||||||||
2006
|
2005
|
2004
|
2006
|
2005
|
2004
|
||||||||||||||
(in
millions)
|
|||||||||||||||||||
Boat
|
$
|
52.1
|
$
|
50.2
|
$
|
45.7
|
$
|
11.0
|
$
|
8.8
|
$
|
15.8
|
|||||||
Marine
Engine
|
63.4
|
58.9
|
55.1
|
2.0
|
0.6
|
0.5
|
|||||||||||||
Fitness
|
10.8
|
11.9
|
11.9
|
0.3
|
0.2
|
0.6
|
|||||||||||||
Bowling
& Billiards
|
21.8
|
20.5
|
20.1
|
0.9
|
0.9
|
1.0
|
|||||||||||||
Corporate/Other
|
5.0
|
4.3
|
2.9
|
—
|
—
|
—
|
|||||||||||||
Total
|
$
|
153.1
|
$
|
145.8
|
$
|
135.7
|
$
|
14.2
|
$
|
10.5
|
$
|
17.9
|
Capital
Expenditures
|
Research
& Development
Expense
|
||||||||||||||||||
2006
|
2005
|
2004
|
2006
|
2005
|
2004
|
||||||||||||||
(in
millions)
|
|||||||||||||||||||
Boat
|
$
|
75.8
|
$
|
74.7
|
$
|
56.5
|
$
|
38.0
|
$
|
36.1
|
$
|
28.3
|
|||||||
Marine
Engine
|
72.5
|
91.5
|
68.7
|
70.3
|
67.3
|
66.6
|
|||||||||||||
Fitness
|
11.0
|
11.2
|
8.3
|
18.4
|
14.2
|
16.0
|
|||||||||||||
Bowling
& Billiards
|
43.7
|
36.8
|
27.7
|
5.5
|
5.9
|
5.9
|
|||||||||||||
Corporate/Other
|
2.1
|
9.6
|
2.6
|
—
|
—
|
—
|
|||||||||||||
Total
|
$
|
205.1
|
$
|
223.8
|
$
|
163.8
|
$
|
132.2
|
$
|
123.5
|
$
|
116.8
|
Net
Sales
|
Long-Lived
Assets
|
|||||||||||||||
2006
|
2005
|
2004
|
2006
|
2005
|
||||||||||||
(in millions)
|
||||||||||||||||
United
States
|
$
|
3,862.6
|
$
|
3,846.6
|
$
|
3,502.5
|
$
|
1,016.9
|
$
|
989.0
|
||||||
International
|
1,802.4
|
1,760.3
|
1,555.6
|
134.3
|
127.1
|
|||||||||||
Corporate/Other
|
—
|
—
|
—
|
201.7
|
228.2
|
|||||||||||
Total
|
$
|
5,665.0
|
$
|
5,606.9
|
$
|
5,058.1
|
$
|
1,352.9
|
$
|
1,344.3
|
Date
|
Name/Description
|
Net
Cash
Consideration(A)
|
|||||
(in
millions)
|
|||||||
2/16/06
|
Cabo
Yachts, Inc.
|
$
|
60.6
|
||||
3/24/06
|
Marine
Innovations Warranty Corporation
|
2.3
|
|||||
4/26/06
|
Diversified
Marine Products, L.P.
|
14.2
|
|||||
9/20/06
|
Protokon
LLC (13.3 percent)
|
|
5.6
|
||||
10/19/06
|
Blue
Water Dealer Services, Inc.
|
3.5
|
|||||
$
|
86.2
|
||||||
Date
|
Name/Description
|
Net
Cash
Consideration(A)
|
Other
Consideration
|
Total
Consideration
|
|||||||||
(in
millions)
|
|||||||||||||
2/07/05
|
Benrock,
Inc.
|
$
|
4.2
|
$
|
-
|
$
|
4.2
|
||||||
2/28/05
|
Albemarle
Boats, Inc.
|
9.2
|
-
|
9.2
|
|||||||||
4/21/05
|
Sea
Pro, Sea Boss and Palmetto boats
|
1.0
|
-
|
1.0
|
|||||||||
5/27/05
|
Triton
Boat Company, L.P.
|
58.4
|
4.4
|
62.8
|
|||||||||
6/20/05
|
Supra-Industria
Textil, Lda. (51 percent)
|
|
7.8
|
0.9
|
8.7
|
||||||||
6/27/05
|
Marine
Innovations Warranty Corporation
|
2.3
|
-
|
2.3
|
|||||||||
7/07/05
|
Kellogg
Marine, Inc.
|
41.7
|
-
|
41.7
|
|||||||||
9/16/05
|
Harris
Kayot Marine, LLC
|
4.8
|
-
|
4.8
|
|||||||||
Various
|
Miscellaneous
|
0.9
|
1.0
|
1.9
|
|||||||||
$
|
130.3
|
$
|
6.3
|
$
|
136.6
|
Date
|
Name/Description
|
Net
Cash
Consideration(A)
|
|||||
(in
millions)
|
|||||||
3/19/04
|
Vulcan-Bowling
Pin Company and
Vulcan-Brunswick
Bowling Pin Company
|
$
|
1.3
|
||||
4/01/04
|
Lowe,
Lund, Crestliner
|
191.0
|
|||||
4/01/04
|
Marine
Innovations Warranty Corporation
|
5.4
|
|||||
12/31/04
|
Sea
Pro, Sea Boss and Palmetto boats
|
50.1
|
|||||
Various
|
Miscellaneous
|
0.4
|
|||||
$
|
248.2
|
||||||
Weighted
Average
Useful
Life
|
||||||||||||||||
2006
|
2005
|
2004
|
2006
|
2005
|
||||||||||||
(in
millions)
|
||||||||||||||||
Indefinite-lived:
|
||||||||||||||||
Goodwill
|
$
|
32.9
|
$
|
41.7
|
$
|
72.6
|
||||||||||
Trademarks/tradenames
|
$
|
17.8
|
$
|
26.9
|
$
|
113.7
|
||||||||||
Amortizable:
|
||||||||||||||||
Customer
relationships
|
$
|
9.1
|
$
|
19.9
|
$
|
20.3
|
10
years
|
11
years
|
||||||||
Other
|
$
|
3.2
|
$
|
5.7
|
$
|
12.4
|
8
years
|
6
years
|
2006
|
2005
|
2004
|
||||||||
(in
millions)
|
||||||||||
United
States
|
$
|
285.6
|
$
|
449.6
|
$
|
346.9
|
||||
Foreign
|
24.1
|
36.3
|
26.4
|
|||||||
Earnings
before income taxes
|
$
|
309.7
|
$
|
485.9
|
$
|
373.3
|
2006
|
2005
|
2004
|
||||||||
(in
millions)
|
||||||||||
Current
tax expense:
|
||||||||||
U.S.
Federal
|
$
|
66.3
|
$
|
99.9
|
$
|
92.4
|
||||
State
and local
|
8.8
|
9.0
|
5.2
|
|||||||
Foreign
|
1.4
|
14.3
|
9.2
|
|||||||
Total
current
|
76.5
|
123.2
|
106.8
|
|||||||
Deferred
tax expense:
|
||||||||||
U.S.
Federal
|
(28.6
|
)
|
(7.5
|
)
|
(6.3
|
)
|
||||
State
and local
|
(4.3
|
)
|
0.1
|
8.1
|
||||||
Foreign
|
2.9
|
(1.0
|
)
|
0.9
|
||||||
Total
deferred
|
(30.0
|
)
|
(8.4
|
)
|
2.7
|
|||||
Total
provision
|
$
|
46.5
|
$
|
114.8
|
$
|
109.5
|
2006
|
2005
|
||||||
(in
millions)
|
|||||||
Current
deferred tax assets:
|
|||||||
Product
warranties
|
$
|
65.7
|
$
|
66.9
|
|||
Sales
incentives and discounts
|
44.4
|
44.4
|
|||||
Litigation
and environmental reserves
|
22.4
|
22.0
|
|||||
Insurance
reserves
|
19.4
|
19.3
|
|||||
Loss
carryforwards
|
1.9
|
47.1
|
|||||
Other
|
97.9
|
87.5
|
|||||
Valuation
allowance
|
(1.8
|
)
|
(12.4
|
)
|
|||
Total
current deferred tax assets
|
$
|
249.9
|
$
|
274.8
|
|||
Non-current
deferred tax liabilities (assets):
|
|||||||
Depreciation
and amortization
|
$
|
160.4
|
$
|
144.4
|
|||
Pension
|
46.0
|
37.0
|
|||||
Other
assets and investments
|
22.0
|
21.5
|
|||||
Other
|
74.0
|
75.8
|
|||||
Non-current
deferred tax liabilities
|
302.4
|
278.7
|
|||||
Deferred
compensation
|
(32.9
|
)
|
(26.1
|
)
|
|||
Pension
|
(84.6
|
)
|
(56.0
|
)
|
|||
Loss
carryforwards
|
(45.2
|
)
|
—
|
||||
Postretirement
and postemployment benefits
|
(45.1
|
)
|
(44.6
|
)
|
|||
Other
|
(16.5
|
)
|
(4.5
|
)
|
|||
Valuation
allowance
|
8.2
|
—
|
|||||
Non-current
deferred tax assets
|
(216.1
|
)
|
(131.2
|
)
|
|||
Total
non-current deferred tax liabilities
|
$
|
86.3
|
$
|
147.5
|
2006
|
2005
|
2004
|
||||||||
(in
millions)
|
||||||||||
Income
tax provision at 35 percent
|
$
|
108.4
|
$
|
170.1
|
$
|
130.6
|
||||
State
and local income taxes, net of Federal income tax effect
|
7.8
|
9.8
|
8.7
|
|||||||
Tax
reserve reassessment
|
(42.6
|
)
|
(7.1
|
)
|
(10.0
|
)
|
||||
Extraterritorial
income benefit
|
(9.8
|
)
|
(12.2
|
)
|
(8.5
|
)
|
||||
Research
and development credit
|
(8.5
|
)
|
(9.7
|
)
|
(7.1
|
)
|
||||
Lower
taxes related to foreign income, net of credits
|
(5.2
|
)
|
(5.7
|
)
|
(2.8
|
)
|
||||
Change
in estimates related to prior years and prior
years’
amended tax return filings
|
(4.4
|
)
|
(15.0
|
)
|
—
|
|||||
Change
in APB No. 23 assertion
|
—
|
(8.7
|
)
|
—
|
||||||
Investment
sale capital loss utilization
|
—
|
(6.6
|
)
|
—
|
||||||
Other
|
0.8
|
(0.1
|
)
|
(1.4
|
)
|
|||||
Actual
income tax provision
|
$
|
46.5
|
$
|
114.8
|
$
|
109.5
|
||||
Effective
tax rate
|
15.0
|
%
|
23.6
|
%
|
29.3
|
%
|
2006
|
2005
|
2004
|
||||||||
(in
millions)
|
||||||||||
Continuing
operations
|
$
|
46.5
|
$
|
114.8
|
$
|
109.5
|
||||
Discontinued
operations
|
(9.6
|
)
|
(4.4
|
)
|
(0.8
|
)
|
||||
Total
tax provision
|
$
|
36.9
|
$
|
110.4
|
$
|
108.7
|
2006
|
2005
|
||||||
(in
millions)
|
|||||||
Balance
at January 1
|
$
|
155.3
|
$
|
163.1
|
|||
Payments
made
|
(116.2
|
)
|
(109.7
|
)
|
|||
Provisions/additions
for contracts issued/sold
|
121.5
|
104.0
|
|||||
Aggregate
changes for preexisting warranties
|
0.4
|
(2.1
|
)
|
||||
Balance
at December 31
|
$
|
161.0
|
$
|
155.3
|
Accumulated
Unrealized Derivative
Gains
(Losses)
|
|||||||||||||
2006
|
2005
|
||||||||||||
Pre-tax
|
After-tax
|
Pre-tax
|
After-tax
|
||||||||||
(in
millions)
|
|||||||||||||
Beginning
balance
|
$
|
11.2
|
$
|
7.9
|
$
|
(17.5
|
)
|
$
|
(12.0
|
)
|
|||
Net
change associated with current period hedging activity
|
(12.6
|
)
|
(8.8
|
)
|
21.6
|
15.1
|
|||||||
Net
amount recognized into earnings
|
9.0
|
6.2
|
7.1
|
4.8
|
|||||||||
Ending
balance
|
$
|
7.6
|
$
|
5.3
|
$
|
11.2
|
$
|
7.9
|
2006
|
2005
|
||||||
(in
millions)
|
|||||||
Accrued
compensation and benefit plans
|
$
|
114.2
|
$
|
161.8
|
|||
Product
warranties
|
158.9
|
149.8
|
|||||
Sales
incentives and discounts
|
157.8
|
160.1
|
|||||
Accrued
recourse/repurchase
|
42.3
|
54.5
|
|||||
Insurance
reserves
|
48.6
|
49.0
|
|||||
Deferred
revenue
|
64.4
|
61.2
|
|||||
Environmental
reserves
|
49.4
|
51.5
|
|||||
Other
|
113.3
|
115.9
|
|||||
Total
accrued expenses
|
$
|
748.9
|
$
|
803.8
|
2006
|
2005
|
||||||
(in
millions)
|
|||||||
Notes
payable
|
$
|
—
|
$
|
0.1
|
|||
Current
maturities of long-term debt
|
0.7
|
1.0
|
|||||
Total
short-term debt
|
$
|
0.7
|
$
|
1.1
|
2006
|
2005
|
||||||
(in
millions)
|
|||||||
Floating
rate notes, due 2009
|
$
|
250.0
|
$
|
—
|
|||
Notes,
6.75% due 2006, net of discount of $0.0 and $0.2
|
—
|
249.8
|
|||||
Notes,
7.125% due 2027, net of discount of $1.0 and $1.0
|
199.0
|
199.0
|
|||||
Notes,
5.0% due 2011, net of discount of $0.5 and $0.7
|
149.5
|
149.3
|
|||||
Debentures,
7.375% due 2023, net of discount of $0.5 and $0.5
|
124.5
|
124.5
|
|||||
Notes,
1.82% to 4.0% payable through 2015
|
3.6
|
4.2
|
|||||
Interest
rate swaps and other
|
(0.2
|
)
|
(2.1
|
)
|
|||
726.4
|
724.7
|
||||||
Current
maturities
|
(0.7
|
)
|
(1.0
|
)
|
|||
Long-term
debt
|
$
|
725.7
|
$
|
723.7
|
|||
Scheduled
maturities
2008
|
$
|
0.8
|
|||||
2009
|
250.8
|
||||||
2010
|
0.3
|
||||||
2011
|
149.5
|
||||||
Thereafter
|
324.3
|
||||||
Total
long-term debt
|
$
|
725.7
|
Before
Application
of
SFAS
158
|
SFAS
158
Adjustments
Increase
(Decrease)
|
After
Application
of
SFAS
158
|
||||||||
(in
millions)
|
||||||||||
Other
assets
|
||||||||||
Other
intangibles, net
|
$
|
353.8
|
$
|
(31.2
|
)
|
$
|
322.6
|
|||
Other
long-term assets
|
216.4
|
(21.3
|
)
|
195.1
|
||||||
Total
assets
|
4,502.8
|
(52.5
|
)
|
4,450.3
|
||||||
Long-term
liabilities
|
||||||||||
Deferred
income taxes
|
124.9
|
(38.6
|
)
|
86.3
|
||||||
Postretirement
and postemployment benefits
|
177.4
|
46.8
|
224.2
|
|||||||
Shareholders’
equity
|
||||||||||
Accumulated
other comprehensive income
(loss),
net of tax:
|
||||||||||
Defined
benefit plans
|
||||||||||
Prior
service cost
|
—
|
(11.2
|
)
|
(11.2
|
)
|
|||||
Net
actuarial loss
|
—
|
(121.7
|
)
|
(121.7
|
)
|
|||||
Minimum
pension liability
|
(72.2
|
)
|
72.2
|
—
|
||||||
Shareholders’
equity
|
1,932.5
|
(60.7
|
)
|
1,871.8
|
||||||
Total
liabilities and shareholders’ equity
|
4,502.8
|
(52.5
|
)
|
4,450.3
|
Pension
Benefits
|
Other
Postretirement
Benefits
|
||||||||||||||||||
2006
|
2005
|
2004
|
2006
|
2005
|
2004
|
||||||||||||||
(in
millions)
|
|||||||||||||||||||
Service
cost
|
$
|
18.5
|
$
|
18.6
|
$
|
17.3
|
$
|
2.9
|
$
|
2.7
|
$
|
2.4
|
|||||||
Interest
cost
|
58.9
|
58.3
|
56.9
|
6.0
|
5.7
|
5.7
|
|||||||||||||
Expected
return on plan assets
|
(78.3
|
)
|
(72.6
|
)
|
(66.0
|
)
|
—
|
—
|
—
|
||||||||||
Amortization
of prior service costs
|
6.8
|
7.3
|
6.0
|
(2.1
|
)
|
(2.1
|
)
|
(2.1
|
)
|
||||||||||
Amortization
of net actuarial loss
|
10.4
|
13.5
|
13.5
|
1.2
|
0.8
|
0.7
|
|||||||||||||
Special
termination benefit
|
0.1
|
—
|
—
|
—
|
—
|
—
|
|||||||||||||
Curtailment
loss
|
—
|
0.8
|
—
|
—
|
—
|
—
|
|||||||||||||
Net
pension and other benefit costs
|
$
|
16.4
|
$
|
25.9
|
$
|
27.7
|
$
|
8.0
|
$
|
7.1
|
$
|
6.7
|
Pension
Benefits
|
Other
Postretirement
Benefits
|
||||||||||||
2006
|
2005
|
2006
|
2005
|
||||||||||
(in
millions)
|
|||||||||||||
Reconciliation
of benefit obligation:
|
|||||||||||||
Benefit
obligation at previous December 31
|
$
|
1,051.0
|
$
|
1,016.8
|
$
|
105.4
|
$
|
100.6
|
|||||
Service
cost
|
18.5
|
18.6
|
2.9
|
2.7
|
|||||||||
Interest
cost
|
58.9
|
58.3
|
6.0
|
5.7
|
|||||||||
Participant
contributions
|
—
|
—
|
1.2
|
1.0
|
|||||||||
Plan
amendments
|
2.9
|
—
|
2.2
|
—
|
|||||||||
Special
termination benefits
|
0.1
|
—
|
—
|
—
|
|||||||||
Acquisition
|
—
|
—
|
0.3
|
||||||||||
Curtailment
|
—
|
(0.3
|
)
|
—
|
—
|
||||||||
Actuarial
(gains) losses
|
(2.6
|
)
|
12.4
|
3.1
|
2.7
|
||||||||
Benefit
payments
|
(51.6
|
)
|
(54.8
|
)
|
(7.2
|
)
|
(7.3
|
)
|
|||||
Benefit
obligation at December 31
|
$
|
1,077.2
|
$
|
1,051.0
|
$
|
113.9
|
$
|
105.4
|
|||||
Reconciliation
of fair value of plan assets:
|
|||||||||||||
Fair
value of plan assets at previous December 31
|
$
|
931.8
|
$
|
867.9
|
$
|
—
|
$
|
—
|
|||||
Actual
return on plan assets
|
93.4
|
91.3
|
—
|
—
|
|||||||||
Employer
contributions
|
17.4
|
27.4
|
6.0
|
6.3
|
|||||||||
Participant
contributions
|
—
|
—
|
1.2
|
1.0
|
|||||||||
Benefit
payments
|
(51.6
|
)
|
(54.8
|
)
|
(7.2
|
)
|
(7.3
|
)
|
|||||
Fair
value of plan assets at December 31
|
$
|
991.0
|
$
|
931.8
|
$
|
—
|
$
|
—
|
|||||
Funded
status at December 31
|
$
|
(86.2
|
)
|
$
|
(119.2
|
)
|
$
|
(113.9
|
)
|
$
|
(105.4
|
)
|
|
Unrecognized
prior service cost (credit)
|
—
|
39.1
|
—
|
(10.4
|
)
|
||||||||
Unrecognized
actuarial losses
|
—
|
200.9
|
—
|
20.1
|
|||||||||
Net
amount recognized
|
$
|
(86.2
|
)
|
$
|
120.8
|
$
|
(113.9
|
)
|
$
|
(95.7
|
)
|
Pension
Benefits
|
Other
Postretirement
Benefits
|
||||||
(in
millions)
|
|||||||
Other
long-term assets
|
$
|
19.7
|
$
|
—
|
|||
Accrued
benefit liability
|
(2.6
|
)
|
(8.0
|
)
|
|||
Long-term
benefit liability
|
(103.3
|
)
|
(105.9
|
)
|
|||
Net
amount recognized
|
$
|
(86.2
|
)
|
$
|
(113.9
|
)
|
Pension
Benefits
|
Other
Postretirement
Benefits
|
||||||
(in
millions)
|
|||||||
Other
intangible assets
|
$
|
34.4
|
$
|
—
|
|||
Other
long-term assets
|
39.9
|
—
|
|||||
Long-term
benefit liability
|
(96.2
|
)
|
(95.7
|
)
|
|||
Accumulated
other comprehensive loss
|
142.7
|
—
|
|||||
Net
amount recognized
|
$
|
120.8
|
$
|
(95.7
|
)
|
Pension
Benefits
|
Other
Postretirement
Benefits
|
||||||||||||
2006
|
2005
|
2006
|
2005
|
||||||||||
(in
millions)
|
|||||||||||||
Prior
service cost (credit)
|
$
|
35.2
|
$
|
—
|
$
|
(6.1
|
)
|
$
|
—
|
||||
Net
actuarial loss
|
172.8
|
—
|
22.0
|
—
|
|||||||||
Minimum
liability adjustment
|
—
|
142.7
|
—
|
—
|
|||||||||
Total
|
$
|
208.0
|
$
|
142.7
|
$
|
15.9
|
$
|
—
|
2006
|
2005
|
||||||
(in
millions)
|
|||||||
Projected
benefit obligation
|
$
|
989.6
|
$
|
963.3
|
|||
Accumulated
benefit obligation
|
$
|
950.2
|
$
|
926.5
|
|||
Fair
value of plan assets
|
$
|
883.7
|
$
|
830.3
|
Pre-age
65 Benefits
|
|||||||
|
2006
|
2005
|
|||||
Health
care cost trend rate for next year
|
9.0
|
%
|
10.0
|
%
|
|||
Rate
to which the cost trend rate is assumed to decline
(the
ultimate trend rate)
|
5.0
|
%
|
5.0
|
%
|
|||
Year
rate reaches the ultimate trend rate
|
2011
|
2011
|
One
Percent
Increase
|
One
Percent
Decrease
|
||||||
(in
millions)
|
|||||||
Effect
on total of service and interest cost
|
$
|
0.6
|
$
|
(0.6
|
)
|
||
Effect
on accumulated postretirement benefit obligation
|
$
|
5.9
|
$
|
(5.3
|
)
|
|
2006
|
2005
|
|||||
Discount
rate
|
6.00
|
%
|
5.75
|
%
|
|||
Rate
of compensation increase(A)
|
3.75
|
%
|
3.75
|
%
|
|
2006
|
2005
|
2004
|
|||||||
Discount
rate
|
5.75
|
%
|
5.90
|
%
|
6.25
|
%
|
||||
Long-term
rate of return on plan assets(A)
|
8.50
|
%
|
8.50
|
%
|
8.50
|
%
|
||||
Rate
of compensation increase(A)
|
3.75
|
%
|
3.75
|
%
|
3.75
|
%
|
Percentage
of
Plan
Assets
|
|||||||
|
2006
|
2005
|
|||||
Asset
Category
Equity
securities
|
68
|
%
|
67
|
%
|
|||
Debt
securities
|
15
|
16
|
|||||
Real
estate
|
13
|
11
|
|||||
Other
|
4
|
6
|
|||||
Total
|
100
|
%
|
100
|
%
|
Pension
Benefits
|
Other
Postretirement
Benefits
|
||||||
(in
millions)
|
|||||||
Company
contributions expected to be made in 2007 (A)
|
$
|
2.6
|
$
|
8.0
|
|||
Expected
benefit payments (which reflect future service):
|
|||||||
2007
|
$
|
58.0
|
$
|
8.5
|
|||
2008
|
$
|
61.8
|
$
|
8.7
|
|||
2009
|
$
|
66.0
|
$
|
8.9
|
|||
2010
|
$
|
69.5
|
$
|
9.1
|
|||
2011
|
$
|
72.9
|
$
|
9.2
|
|||
2012-2016
|
$
|
412.8
|
$
|
45.9
|
2005
|
2004
|
||||||
(in
millions, except per share data)
|
|||||||
Net
earnings from continuing operations, as reported
|
$
|
371.1
|
$
|
263.8
|
|||
Add:
Share-based employee compensation
included in reported earnings, net of tax
|
1.8
|
6.0
|
|||||
Less:
Total share-based employee compensation
expense under fair value-based method for
all awards, net of tax
|
8.7
|
11.0
|
|||||
Net
earnings from continuing operations, pro forma
|
$
|
364.2
|
$
|
258.8
|
|||
Basic
earnings from continuing operations per common share:
|
|||||||
As
reported
|
$
|
3.80
|
$
|
2.76
|
|||
Pro
forma
|
$
|
3.73
|
$
|
2.71
|
|||
Diluted
earnings from continuing operations per common share:
|
|||||||
As
reported
|
$
|
3.76
|
$
|
2.71
|
|||
Pro
forma
|
$
|
3.69
|
$
|
2.66
|
2006
|
2005
|
2004
|
|||||||||||||||||||||||
(Options
in thousands)
|
|
Stock
Options
Outstanding
|
|
Weighted
Average
Exercise
Price
|
|
Weighted
Average
Remaining
Contractual
Term
|
Aggregate
Intrinsic
Value
|
Stock
Options
Outstanding
|
Weighted
Average
Exercise
Price
|
Stock
Options
Outstanding
|
Weighted
Average
Exercise
Price
|
||||||||||||||
Outstanding
on January 1
|
3,844
|
|
$
29.91
|
3,702
|
|
$
24.59
|
7,615
|
|
$
22.97
|
||||||||||||||||
Granted
|
906
|
|
$
39.06
|
934
|
|
$
45.90
|
446
|
|
$
38.77
|
||||||||||||||||
Exercised
|
(548)
|
|
|
$
21.95
|
|
$ 8,369
|
(740)
|
|
|
$
23.17
|
(4,294)
|
|
|
$
23.19
|
|||||||||||
Forfeited
|
(201)
|
|
|
$
38.90
|
(52)
|
|
|
$
34.04
|
(65)
|
|
|
$
24.92
|
|||||||||||||
|
|
||||||||||||||||||||||||
Outstanding
on December 31
|
4,001
|
|
$
32.62
|
6.3
years
|
|
$
17,688
|
3,844
|
|
$
29.91
|
3,702
|
|
$
24.59
|
|||||||||||||
|
|||||||||||||||||||||||||
Exercisable
on December 31
|
2,338
|
|
$
26.73
|
4.8
years
|
|
$
17,068
|
2,312
|
|
$
23.45
|
1,980
|
|
$
22.93
|
Range
of Exercise
Price
|
Number
Outstanding
(in
thousands)
|
Weighted
Average
Remaining
Years
of
Contractual
Life
|
Weighted
Average
Exercise
Price
|
Number
Exercisable
(in
thousands)
|
Weighted
Average
Remaining
Years
of
Contractual
Life
|
Weighted
Average
Exercise
Price
|
|||||||||||||
$17.38
to $20.00
|
659
|
3.7
years
|
|
$
19.65
|
659
|
3.7
years
|
|
$
19.65
|
|||||||||||
$20.01
to $30.00
|
1,151
|
4.9
years
|
|
$
23.57
|
1,075
|
4.8
years
|
|
$
23.55
|
|||||||||||
$30.01
to $40.00
|
1,327
|
7.8
years
|
|
$
38.23
|
356
|
4.8
years
|
|
$
36.09
|
|||||||||||
$40.01
to $49.27
|
864
|
8.1
years
|
|
$
45.99
|
248
|
8.1
years
|
|
$
45.90
|
|
2006
|
2005
|
2004
|
|||||||
Risk-free
interest rate
|
4.4
|
%
|
3.7
|
%
|
3.1
|
%
|
||||
Dividend
yield
|
1.5
|
%
|
1.4
|
%
|
1.3
|
%
|
||||
Volatility
factor
|
31.2
|
%
|
34.1
|
%
|
34.7
|
%
|
||||
Weighted
average expected life
|
4.8
- 6.1 years
|
5.0
years
|
5.0
years
|
2006
|
2005
|
2004
|
|||
(in
thousands)
|
|||||
Outstanding
at January 1
|
519
|
824
|
426
|
||
Granted
|
325
|
103
|
524
|
||
Released
|
(227)
|
(101)
|
(113)
|
||
Forfeited
|
(67)
|
(307)
|
(13)
|
||
Outstanding
at December 31
|
550
|
519
|
824
|
2006
|
2005
|
2004
|
||||||||
(Shares
in thousands)
|
||||||||||
Balance
at January 1
|
6,881
|
5,709
|
10,408
|
|||||||
Common
stock repurchase program
|
5,638
|
1,943
|
—
|
|||||||
Compensation
plans and other
|
(848
|
)
|
(771
|
)
|
(4,699
|
)
|
||||
Balance
at December 31
|
11,671
|
6,881
|
5,709
|
2006
|
2005
|
2004
|
||||||||
(in
millions)
|
||||||||||
Basic
expense
|
$
|
48.8
|
$
|
43.1
|
$
|
51.7
|
||||
Contingent
expense
|
2.6
|
2.3
|
2.1
|
|||||||
Sublease
income
|
(0.9
|
)
|
(0.9
|
)
|
(0.6
|
)
|
||||
Rent
expense, net
|
$
|
50.5
|
$
|
44.5
|
$
|
53.2
|
(in
millions)
|
||||
2007
|
$
|
42.9
|
||
2008
|
33.4
|
|||
2009
|
28.1
|
|||
2010
|
21.9
|
|||
2011
|
17.8
|
|||
Thereafter
|
42.5
|
|||
Total
(not reduced by minimum sublease rentals of $1.5)
|
$
|
186.6
|
Quarter
Ended
|
||||||||||||||||
(in
millions, except per share data)
|
April
1,
2006
|
July
1,
2006
|
Sept.
30,
2006
|
Dec.
31,
2006
|
Year
Ended
Dec.
31,
2006
|
|||||||||||
Net
sales
|
$
|
1,413.3
|
$
|
1,543.1
|
$
|
1,337.8
|
$
|
1,370.8
|
$
|
5,665.0
|
||||||
Gross
margin (A)
|
$
|
313.4
|
$
|
354.8
|
$
|
288.9
|
$
|
268.6
|
$
|
1,225.7
|
||||||
Net
earnings from continuing operations
|
$
|
74.2
|
$
|
94.4
|
$
|
50.4
|
$
|
44.2
|
$
|
263.2
|
||||||
Net
earnings
|
$
|
67.4
|
$
|
83.2
|
$
|
36.5
|
$
|
(53.2
|
)
|
$
|
133.9
|
|||||
Basic
earnings per common share:
|
||||||||||||||||
Net
earnings from continuing operations
|
$
|
0.78
|
$
|
1.00
|
$
|
0.54
|
$
|
0.48
|
$
|
2.80
|
||||||
Net
earnings from discontinued operations
|
(0.07
|
)
|
(0.12
|
)
|
(0.15
|
)
|
(1.05
|
)
|
(1.38
|
)
|
||||||
Net
earnings (loss)
|
$
|
0.71
|
$
|
0.88
|
$
|
0.39
|
$
|
(0.57
|
)
|
$
|
1.42
|
|||||
Diluted
earnings per common share:
|
||||||||||||||||
Net
earnings from continued operations
|
$
|
0.77
|
$
|
0.99
|
$
|
0.54
|
$
|
0.48
|
$
|
2.78
|
||||||
Net
earnings from discontinued operations
|
(0.07
|
)
|
(0.12
|
)
|
(0.15
|
)
|
(1.05
|
)
|
(1.37
|
)
|
||||||
Net
earnings (loss)
|
$
|
0.70
|
$
|
0.87
|
$
|
0.39
|
$
|
(0.57
|
)
|
$
|
1.41
|
|||||
Dividends
declared
|
$
|
—
|
$
|
—
|
$
|
—
|
$
|
0.60
|
$
|
0.60
|
||||||
Common
stock price (NYSE symbol: BC):
|
||||||||||||||||
High
|
$
|
42.30
|
$
|
40.50
|
$
|
33.31
|
$
|
33.24
|
$
|
42.30
|
||||||
Low
|
$
|
36.04
|
$
|
32.35
|
$
|
27.56
|
$
|
30.71
|
$
|
27.56
|
Quarter
Ended
|
||||||||||||||||
April
2,
2005
|
July
2,
2005
|
Oct.
1,
2005
|
Dec.
31,
2005
|
Year
Ended
Dec.
31,
2005
|
||||||||||||
Net
sales
|
$
|
1,342.5
|
$
|
1,531.6
|
$
|
1,351.1
|
$
|
1,381.7
|
$
|
5,606.9
|
||||||
Gross
margin (A)
|
$
|
321.2
|
$
|
386.6
|
$
|
305.5
|
$
|
308.3
|
$
|
1,321.6
|
||||||
Net
earnings from continuing operations
|
$
|
94.0
|
$
|
111.0
|
$
|
82.5
|
$
|
83.6
|
$
|
371.1
|
||||||
Net
earnings
|
$
|
94.6
|
$
|
114.1
|
$
|
88.4
|
$
|
88.3
|
$
|
385.4
|
||||||
Basic
earnings per common share:
|
||||||||||||||||
Net
earnings from continuing operations
|
$
|
0.96
|
$
|
1.13
|
$
|
0.84
|
$
|
0.86
|
$
|
3.80
|
||||||
Net
earnings from discontinued operations
|
0.01
|
0.03
|
0.06
|
0.05
|
0.15
|
|||||||||||
Net
earnings (loss)
|
$
|
0.97
|
$
|
1.16
|
$
|
0.90
|
$
|
0.91
|
$
|
3.95
|
||||||
Diluted
earnings per common share:
|
||||||||||||||||
Net
earnings from continued operations
|
$
|
0.95
|
$
|
1.12
|
$
|
0.83
|
$
|
0.85
|
$
|
3.76
|
||||||
Net
earnings from discontinued operations
|
0.01
|
0.03
|
0.06
|
0.05
|
0.14
|
|||||||||||
Net
earnings (loss)
|
$
|
0.96
|
$
|
1.15
|
$
|
0.89
|
$
|
0.90
|
$
|
3.90
|
||||||
Dividends
declared
|
$
|
—
|
$
|
—
|
$
|
—
|
$
|
0.60
|
$
|
0.60
|
||||||
Common
stock price (NYSE symbol: BC):
|
||||||||||||||||
High
|
$
|
48.57
|
$
|
49.50
|
$
|
46.70
|
$
|
42.09
|
$
|
49.50
|
||||||
Low
|
$
|
43.94
|
$
|
41.63
|
$
|
36.98
|
$
|
35.09
|
$
|
35.09
|
Allowances
for
Losses
on Receivables
|
Balance
at
Beginning
of
Year
|
Charges
to
Profit
and Loss
|
Write-offs
|
Recoveries
|
Other
|
Balance
at
End
of Year
|
|||||||||||||
2006
|
$
|
22.1
|
$
|
9.2
|
$
|
(5.7
|
)
|
$
|
(1.5
|
)
|
$
|
5.6
|
$
|
29.7
|
|||||
2005
|
$
|
28.7
|
$
|
(0.7
|
)
|
$
|
(6.0
|
)
|
$
|
0.1
|
$
|
0.2
|
$
|
22.1
|
|||||
2004
|
$
|
30.9
|
$
|
4.9
|
$
|
(8.6
|
)
|
$
|
1.7
|
$
|
(0.2
|
)
|
$
|
28.7
|
Deferred
Tax Asset
Valuation
Allowance (A)
|
Balance
at
Beginning
of
Year
|
Charges
to
Profit
and Loss
|
Write-offs
|
Recoveries
|
Other
|
Balance
at
End
of Year
|
|||||||||||||
2006
|
$
|
12.4
|
$
|
(0.1
|
)
|
$
|
—
|
$
|
—
|
$
|
(2.3
|
)
|
$
|
10.0
|
|||||
2005
|
$
|
20.0
|
$
|
(7.6
|
)
|
$
|
—
|
$
|
—
|
$
|
—
|
$
|
12.4
|
||||||
2004
|
$
|
13.0
|
$
|
—
|
$
|
—
|
$
|
—
|
$
|
7.0
|
$
|
20.0
|
(A)
|
State
and foreign net operating loss carryforwards that are not expected
to be
utilized.
|
BRUNSWICK CORPORATION | ||
|
|
|
February 23, 2007 | By: | /s/ ALAN L. LOWE |
Alan
L. Lowe
Vice
President and Controller
|
|
|
|
February 23, 2007 | By: | /s/DUSTAN E. McCOY |
Dustan E. McCoy
Chairman and Chief Executive Officer
(Principal Executive
Officer)
|
|
|
|
February 23, 2007 | By: | /s/ PETERG. LEEMPUTTE |
Peter G. Leemputte
Senior Vice President and Chief Financial
Officer
(Principal Financial
Officer)
|
|
|
|
February 23, 2007 | By: | /s/ ALAN L. LOWE |
Alan L. Lowe
Vice President and Controller
(Principal
Accounting Officer)
|
Nolan
D. Archibald
|
Jeffrey
L. Bleustein
|
Michael
J. Callahan
|
Manuel
A. Fernandez
|
Peter
Harf
|
Graham
H. Phillips
|
Roger
W. Schipke
|
Ralph
C. Stayer
|
Lawrence
A. Zimmerman
|
|
|
|
February 23, 2007 | By: | /s/ PETER G. LEEMPUTTE |
Peter G. Leemputte
Attorney-in-Fact
|
Exhibit
No.
|
Description
|
3.1
|
Restated
Certificate of Incorporation of the Company filed as Exhibit 19.2
to the
Company’s
|
Quarterly
Report on Form 10-Q for the quarter ended June 30, 1987, and hereby
incorporated
by
reference.
|
|
3.2
|
Certificate
of Designation, Preferences and Rights of Series A Junior Participating
Preferred
Stock
filed as Exhibit 3.2 to the Company’s Annual Report on Form 10-K for 1995,
and hereby
incorporated
by reference.
|
3.3
|
By-Laws
of the Company filed as Exhibit 3.3 to the Company’s Annual Report on Form
10-K
for
2002, and hereby incorporated by reference.
|
4.1
|
Indenture
dated as of March 15, 1987, between the Company and Continental Illinois
National
Bank
and Trust Company of Chicago filed as Exhibit 4.1 to the Company’s
Quarterly Report
on
Form 10-Q for the quarter ended March 31, 1987, and hereby incorporated
by
reference.
|
4.2
|
Officers’
Certificate setting forth terms of the Company’s $125,000,000 principal
amount of
7
3/8% Debentures due September 1, 2023, filed as Exhibit 4.3 to the
Company’s Annual Report
on
Form 10-K for 1993, and hereby incorporated by
reference.
|
4.3
|
Form
of the Company’s $200,000,000 principal amount of 7 1/8% Notes due August
1, 2027, filed
as
Exhibit 4.1 to the Company’s Current Report on Form 8-K dated August 4,
1997, and hereby
incorporated
by reference.
|
4.4
|
The
Company’s agreement to furnish additional debt instruments upon request by
the Securities
and
Exchange Commission filed as Exhibit 4.10 to the Company’s Annual Report
on Form 10-K
for
1980, and hereby incorporated by
reference.
|
4.5
|
Form
of the Company’s $150,000,000 principal amount of 5% Notes due 2011, filed
as Exhibit 4.1
to
the Company’s Current Report on Form 8-K dated May 26, 2004, and hereby
incorporated by
reference.
|
4.6
|
Credit
Agreement dated as of November 15, 2002, setting forth the terms
of the
Company’s
$350,000,000
Revolving Credit and Competitive Bid Loan Facility with JPMorgan
Chase
Bank,
administrative
agent, and other lenders identified in the Credit Agreement, filed
as
Exhibit 4.8 to
the
Company’s Annual Report on Form 10-K for 2002, and hereby incorporated by
reference.
|
4.7
|
Credit
Agreement dated as of April 29, 2005, setting forth the terms of
the
Company’s
$650,000,000
Revolving Credit and Competitive Bid Loan Facility with JPMorgan
Chase
Bank,
administrative
agent, and other lenders identified in the Credit Agreement, filed
as
Exhibit 10.4 to
the
Company’s Quarterly Report on Form 10-Q for the quarter ended March 31,
2005, and hereby
incorporated
by reference.
|
4.8
|
Form
of the Company’s $250,000,000 principal amount of floating rate Notes due
July 24, 2009,
filed
as Exhibit 4.1 to the Company’s Current Report on Form 8-K dated July 24,
2006, and hereby
incorporated
by reference.
|
10.1*
|
Terms
and Conditions of Employment between the Company and D. E. McCoy,
filed as
Exhibit
10.1
to the Company’s Current Report on Form 8-K dated September 18, 2006, and
hereby
incorporated
by reference.
|
10.2*
|
Form
of Terms and Conditions of Employment between the Company and each
of T.J.
Chung, W.
N.
Hardie, P. G. Leemputte, B. R. Lockridge, P. C. Mackey, A. L. Lowe,
M. I.
Smith and J. E.
Stransky,
filed as Exhibit 10.1 to the Company’s Current Report on Form 8-K dated
January 18,
2007,
and hereby incorporated by reference.
|
10.3*
|
1994
Stock Option Plan for Non-Employee Directors filed as Exhibit A to
the
Company’s
definitive
Proxy Statement dated March 25, 1994, for the Annual Meeting of
Stockholders on
April
27, 1994, and hereby incorporated by
reference.
|
10.4*
|
Supplemental
Pension Plan filed as Exhibit 10.7 to the Company’s Quarterly Report on
Form
10-Q
for the quarter ended September 30, 1998, and hereby incorporated
by
reference.
|
10.5*
|
Form
of Indemnification Agreement by and between the Company and each
of N. D.
Archibald,
J.
L. Bleustein, M. J. Callahan, C. W. Dunaway, M. A. Fernandez, P.
Harf,
G.H. Phillips, R.W.
Schipke,
R. C. Stayer and L. A. Zimmerman.
|
10.6*
|
1991
Stock Plan filed as Exhibit 10 to the Company’s Quarterly Report on Form
10-Q for the
quarter
ended June 30, 1999, and hereby incorporated by
reference.
|
10.7*
|
Brunswick
Performance Plan for 2006.
|
10.8*
|
Brunswick
Performance Plan for 2007.
|
10.9*
|
Brunswick
Strategic Incentive Plan for 2005 - 2006 filed as Exhibit 10.2 to
the
Company’s Current
Report
on Form 8-K filed February 3, 2005, and hereby incorporated by
reference.
|
10.10*
|
Brunswick
Strategic Incentive Plan for 2006 - 2007.
|
10.11*
|
Brunswick
Strategic Incentive Plan for 2007 -
2008.
|
10.12*
|
1997
Stock Plan for Non-Employee Directors filed as Exhibit 10.3 to the
Company’s Quarterly
Report
on Form 10-Q for the quarter ended September 30, 1998, and hereby
incorporated by
reference.
|
10.13*
|
Elective
Deferred Compensation Plan filed as Exhibit 4.6 to the Company’s
Registration Statement
on
Form S-8 (333-112880) filed February 17, 2004, and hereby incorporated
by
reference.
|
10.14*
|
Automatic
Deferred Compensation Plan filed as Exhibit 10.24 to the Company’s Annual
Report on
Form
10-K for 2003 and hereby incorporated by reference.
|
10.15*
|
Brunswick
Restoration Plan filed as Exhibit 4.7 to the Company’s Registration
Statement on Form
S-8
(333-112880) filed February 17, 2004, and hereby incorporated by
reference.
|
10.16*
|
Brunswick
2003 Stock Incentive Plan filed as Exhibit 4.5 to the Company’s
Registration Statement
on
Form S-8 (333-112880) filed February 17, 2004, and hereby incorporated
by
reference.
|
12.1
|
Statement
regarding computation of ratios.
|
21.1
|
Subsidiaries
of the Company.
|
23.1
|
Consent
of Independent Registered Public Accounting Firm.
|
24.1
|
Power
of Attorney.
|
31.1
|
Certification
of Chief Executive Officer Pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002.
|
31.2
|
Certification
of Chief Financial Officer Pursuant to Section 302 of the Sarbanes-Oxley
Act of 2002.
|
32.1
|
Certification
of Chief Executive Officer Pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002.
|
32.2
|
Certification
of Chief Financial Officer Pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002.
|
*
|
Management
contract or compensatory plan or
arrangement.
|