NWL Newell Brands, Inc.

Management Discussion

• Three Months Ended September 30, 2019 vs. Three Months Ended September 30, 2018
• The decrease in net sales for the three months ended September 30, 2019 was primarily due to a decline in sales across all segments, primarily within the Appliances and Cookware and Food and Commercial segments. These changes are inclusive of unfavorable changes in foreign currency (approximately 1%).
• Cost of products sold for the three months ended September 30, 2019 increased slightly compared to the prior year period. Reported gross profit margin was 33.1% versus 35.9% in the prior year period. The change was primarily due to the unfavorable impact of lower sales and inflation related input costs and tariffs, partially offset by improved pricing and productivity savings. In addition, gross profit margin was unfavorably impacted as a result of the cumulative depreciation expense adjustment recorded as a result of the Company’s decision to retain the Commercial Business. The Company recorded a charge of $35.2 million in the third quarter of 2019 relating to the amount of depreciation expense that would have been recorded in prior periods had Commercial Business been continuously classified as held and used. See Footnotes 1, 2 and 6 of the Notes to the Consolidated Financial Statements for further information.