ScottsMiracle-Gro Announces Financial Results for Fiscal 2012

        ScottsMiracle-Gro Announces Financial Results for Fiscal 2012

-- Full-year sales increased 1% to $2.83 billion, Q4 sales flat at $401
million

-- Consumer purchases were up 2.1% for the year and increased 3.2% in Q4

-- Full-year adjusted earnings from continuing operations of $2.01 per share

PR Newswire

MARYSVILLE, Ohio, Nov. 8, 2012

MARYSVILLE, Ohio, Nov. 8, 2012 /PRNewswire-FirstCall/ --The Scotts
Miracle-Gro Company (NYSE: SMG), the world's leading marketer of branded
consumer lawn and garden products, today announced results for the fourth
quarter and full year ended September 30, 2012.

Fiscal 2012 net sales increased 1 percent to $2.83 billion, compared to $2.80
billion a year ago. Global Consumer sales were flat at $2.5 billion for the
year. Scotts LawnService sales for fiscal 2012 increased 4 percent to $245.8
million, compared to $235.6 million a year ago.

Adjusted income from continuing operations for fiscal 2012 was $124.9 million,
or $2.01 per share, compared to $187.2 million, or $2.83 per share, a year
ago. Adjusted results exclude charges related to product registration and
recall matters, as well as impairment, restructuring and other charges.

"Although results did not meet our original expectations, we continue to see
benefits from improved marketing and innovation, which helped us grow market
share in nearly every category this season," said Jim Hagedorn, chairman and
chief executive officer. "Our immediate focus remains on returning our
business to levels of earnings and cash flow we saw two years ago, which we
believe will drive shareholder value in both the near- and long-term.

"I am confident that we can accomplish this through a series of initiatives
which we will provide greater detail on at our upcoming Analyst Day meeting in
December. Also during this meeting, we will provide our outlook for fiscal
2013."

Fourth Quarter Details
Net sales were $401.2 million, flat compared to the same quarter a year ago.
Sales in the Global Consumer segment increased 1 percent to $309.8 million.
Excluding the impact of foreign exchange, Global Consumer sales increased 2
percent. Scotts LawnService reported sales of $84.5 million, an increase of 1
percent from a year ago. Consumer purchases at the Company's largest U.S.
retailers increased 3.2 percent during the quarter.

Results of operations for the Company's professional grass seed business
(ProSeed) have been moved to discontinued operations for 2012 and 2011. The
Company will update its prior years' quarterly and annual financial results
from continuing operations to reflect ProSeed as a discontinued operation when
it files its Form 10-K later this month.

On an adjusted basis, the company-wide gross margin rate was 26.2 percent,
compared with 28.2 percent during the fourth quarter a year ago. The
200-basis-point decline was attributable primarily to higher material costs
and unfavorable conversion costs.

Selling, general and administrative expenses (SG&A) were $148.6 million,
compared to $136.4 million a year ago. The year-over-year increase of $12.2
million was primarily due to increased advertising and severance expenses as
well as increased reserves against doubtful accounts.

Adjusted loss from continuing operations was $36.4 million, or $0.59 per
share, compared with a loss of $25.7 million, or $0.41 per share a year ago.
Fiscal 2012 fourth quarter adjusted earnings exclude $0.2 million related to
product registration and recall matters.

During the quarter, the Company finalized settlement agreements with both the
U.S. Department of Justice and the U.S. Environmental Protection Agency
related to certain Company products distributed and sold through 2009. As a
result, the Company does not expect to incur additional product registration
or product recall costs related to these matters.

The operating loss for the Global Consumer segment was $39.1 million during
the fourth quarter, compared with a loss of $28.3 million last year. Scotts
LawnService reported operating income of $22.1 million for the fourth quarter,
compared with $23.2 million a year ago. The consolidated company-wide adjusted
loss from continuing operations before income taxes was $56.3 million during
the fourth quarter of 2012, compared to a loss of $39.3 million a year ago.

Full-Year Details
Net sales were $2.83 billion, compared to $2.80 billion a year ago. Global
Consumer sales were flat at $2.5 billion. Excluding the impact of foreign
exchange, Global Consumer sales increased 1 percent. Scotts LawnService sales
increased 4 percent to $245.8 million, compared to $235.6 million a year ago.
Consumer purchases at the Company's largest U.S. retailers increased 2.1
percent in fiscal 2012.

On an adjusted basis, the company-wide gross margin rate declined 280 basis
points to 34.0 percent. The decline was attributable primarily to higher
material costs and distribution costs, partially offset by increased pricing.

SG&A totaled $705.7 million, compared to $686.3 million a year ago. The
year-over-year increase of $19.4 million was primarily attributable to
increased advertising and marketing.

Adjusted earnings before interest, taxes, depreciation and amortization
(EBITDA) were $302.9 million, compared to $393.0 million a year ago.

Adjusted income from continuing operations was $124.9 million, or $2.01 per
share, compared with $187.2 million, or $2.83 per share in fiscal 2011.
Adjusted results for fiscal 2012 exclude charges related to product
registration and recall matters of approximately $7.4 million, as well as
impairment, restructuring and other charges of approximately $4.3 million.

The Global Consumer segment reported operating income of $338.3 million for
fiscal 2012, compared to $425.0 million a year ago. Scotts LawnService
reported operating income of $27.0 million during the year, compared to $25.9
million in fiscal 2011. The consolidated company-wide adjusted income from
continuing operations before income taxes was $197.1 million during fiscal
2012, compared to $293.1 million a year ago.

Company to Hold Its Analyst Day Meeting on Dec. 14
The Company will hold its Analyst & Investor Day on Friday, December 14, 2012
at the Waldorf Astoria Hotel in New York, beginning at 9 a.m. Eastern Time. A
live webcast of the meeting will be available on the investor relations
section of the Company's website at http://investor.scotts.com. Presentation
slides and a replay of the webcast will be available on the website following
the meeting.

Conference Call and Webcast Scheduled for 9 a.m. ET Today, Nov. 8
The Company will discuss its results during a webcast and conference call
today at 9 a.m. Eastern Time. To participate in the conference call, call
1-866-682-3515 (Conference ID: 43819004). A replay can be heard by calling
1-855-859-2056. A webcast of the call also will be available live at
http://investor.scotts.com. An archive of the webcast, as well as
accompanying financial information regarding any non-GAAP financial measures
discussed by the Company during the call, will be available on the website for
at least 12 months.

About ScottsMiracle-Gro
With more than $2.8 billion in worldwide sales, The Scotts Miracle-Gro
Company, through its wholly-owned subsidiary, The Scotts Company LLC, is the
world's largest marketer of branded consumer products for lawn and garden
care.The Company's brands are the most recognized in the industry.In the
U.S., the Company's Scotts®, Miracle-Gro® and Ortho® brands are market-leading
in their categories, as is the consumer Roundup® brand, which is marketed in
North America and most of Europe exclusively by Scotts and owned by
Monsanto.In the U.S., we operate Scotts LawnService®, the second largest
residential lawn care service business. In Europe, the Company's brands
include Weedol®, Pathclear®, Evergreen®, Levington®, Miracle-Gro®, KB®,
Fertiligene® and Substral®. For additional information, visit us at
www.scotts.com.

Cautionary Note Regarding Forward-Looking Statements
Statements contained in this press release, other than statements of
historical fact, which address activities, events and developments that the
Company expects or anticipates will or may occur in the future, including, but
not limited to, information regarding the future economic performance and
financial condition of the Company, the plans and objectives of the Company's
management, and the Company's assumptions regarding such performance and plans
are "forward-looking statements" within the meaning of the U.S. federal
securities laws that are subject to risks and uncertainties. These
forward-looking statements generally can be identified as statements that
include phrases such as "guidance," "outlook," "projected," "believe,"
"target," "predict," "estimate," "forecast," "strategy," "may," "goal,"
"expect," "anticipate," "intend," "plan," "foresee," "likely," "will,"
"should" or other similar words or phrases. Actual results could differ
materially from the forward-looking information in this release due to a
variety of factors, including, but not limited to:

  oCompliance with environmental and other public health regulations could
    increase the Company's costs of doing business or limit the Company's
    ability to market all of its products;
  oIncreases in the prices of raw materials and fuel costs could adversely
    affect the Company's results of operations;
  oThe highly competitive nature of the Company's markets could adversely
    affect its ability to maintain or grow revenues;
  oBecause of the concentration of the Company's sales to a small number of
    retail customers, the loss of one or more of, or significant reduction in
    orders from, its top customers could adversely affect the Company's
    financial results;
  oAdverse weather conditions could adversely impact financial results;
  oThe Company's international operations make the Company susceptible to
    fluctuations in currency exchange rates and to other costs and risks
    associated with international regulation;
  oThe Company may not be able to adequately protect its intellectual
    property and other proprietary rights that are material to the Company's
    business;
  oThe Company depends on key personnel and may not be able to retain those
    employees or recruit additional qualified personnel;
  oIf Monsanto Company were to terminate the Marketing Agreement for consumer
    Roundup products, the Company would lose a substantial source of future
    earnings and overhead expense absorption;
  oHagedorn Partnership, L.P. beneficially owns approximately 30% of the
    Company's common shares and can significantly influence decisions that
    require the approval of shareholders;
  oThe Company may pursue acquisitions, dispositions, investments, dividends,
    share repurchases and/or other corporate transactions that it believes
    will maximize equity returns of its shareholders but may involve risks.

Additional detailed information concerning a number of the important factors
that could cause actual results to differ materially from the forward-looking
information contained in this release is readily available in the Company's
publicly filed quarterly, annual and other reports. The Company disclaims any
obligation to update developments of these risk factors or to announce
publicly any revision to any of the forward-looking statements contained in
this release, or to make corrections to reflect future events or developments.



               THE SCOTTS MIRACLE GRO-COMPANY
               Condensed Consolidated Statement of Operations (3)
               (in millions, except for per common share data)
               (Unaudited)
                           Three Months Ended                    Twelve Months Ended
                           September30,  September30,  %       September30,  September30,  %
                Footnotes  2012           2011                   2012           2011
                                                         Change                                Change
Net sales                  $   401.2      $   403.1      —       $  2,826.1     $  2,799.7     1%
Cost of sales              296.2          289.3                  1,864.4        1,769.0
Cost of sales
- impairment,
restructuring              —              18.3                   —              18.3
and other
charges
Cost of sales -
product
registration               —              —                      0.4            3.2
and recall
matters
Gross profit               105.0          95.5           10%     961.3          1,009.2        (5)%
% of sales                 26.2%          23.7%                  34.0%          36.0%
Operating
expenses:
Selling,
general and                148.6          136.4          9%      705.7          686.3          3%
administrative
Impairment,
restructuring              —              34.0                   7.1            37.6
and other
charges
Product
registration               0.4            3.6                    7.8            11.4
and recall
matters
Other (income)             0.7            3.0                    (2.9)          (0.9)
expense, net
Income (loss)
from                       (44.7)         (81.5)         (45)%   243.6          274.8          (11)%
operations
% of sales                 (11.1)%        (20.2)%                8.6%           9.8%
Costs related              —              —                      —              1.2
to refinancing
Interest                   12.0           13.7                   61.8           51.0
expense
Income (loss) from
continuing operations      (56.7)         (95.2)         (40)%   181.8          222.6          (18.3)%
before income taxes
Income tax expense
(benefit) from             (20.1)         (33.2)                 68.6           82.7
continuing operations
Income (loss)
from                       (36.6)         (62.0)         (41)%   113.2          139.9          (19)%
continuing
operations
Income (loss)
from
discontinued    (3)        (3.5)          8.6                    (6.7)          28.0
operations,
net of tax
Net income                 $   (40.1)     $   (53.4)             $  106.5       $  167.9
(loss)
Basic income
(loss) per      (1)
common share:
Income (loss)
from                       $   (0.60)     $   (1.00)     (40)%   $  1.86        $  2.16        (14)%
continuing
operations
Income (loss)
from                       (0.06)         0.14                   (0.11)         0.44
discontinued
operations
Net income                 $   (0.66)     $   (0.86)             $  1.75        $  2.60
(loss)
Diluted income
(loss) per      (2)
common share:
Income (loss)
from                       $   (0.60)     $   (1.00)     (40)%   $  1.82        $  2.11        (14)%
continuing
operations
Income (loss)
from                       (0.06)         0.14                   (0.11)         0.43
discontinued
operations
Net income                 $   (0.66)     $   (0.86)             $  1.71        $  2.54
(loss)
Common shares
used in basic
income (loss)              61.2           62.0           (1)%    61.0           64.7           (6)%
per share
calculation
Common shares
and potential
common shares
used in                    61.2           62.0           (1)%    62.1           66.2           (6)%
diluted
income (loss)
per share
calculation
Non-GAAP results from
continuing operations:
Adjusted
income (loss)
from            (4)        $   (36.4)     $   (25.7)     (42)%   $  124.9       $  187.2       (33)%
continuing
operations
Adjusted
diluted income
(loss) per      (2) (4)    $   (0.59)     $   (0.41)     (46)%   $  2.01        $  2.83        (29)%
share from
continuing
operations
Adjusted        (3) (4)    $   (34.9)     $   (27.5)     (27)%   $  302.9       $  393.0       (23)%
EBITDA
Note: See accompanying
footnotes on page 10.



THE SCOTTS MIRACLE-GRO COMPANY
Net Sales and Income (Loss) from Continuing Operations before Income Taxes by
Segment (3)
(in millions)
(Unaudited)

The Company is divided into the following reportable segments: Global Consumer
and Scotts LawnService®. This division of reportable segments is consistent
with how the segments report to and are managed by the chief operating
decision maker of the Company.

Segment performance is evaluated based on several factors, including income
from continuing operations before amortization, product registration and
recall costs, impairment, restructuring and other charges, which is not a
generally accepted accounting principle ("GAAP") measure. Senior management of
the Company uses this measure of operating profit to evaluate segment
performance because we believe this measure is the most indicative of
performance trends and the overall earnings potential of each segment.

Corporate & Other consists of revenues and expenses associated with the
Company's supply agreements with Israel Chemicals Ltd. and the amortization
related to the Roundup® Marketing Agreement, as well as corporate, general and
administrative expenses and certain other income/expense items not allocated
to the business segments. Corporate & Other assets primarily include deferred
financing and debt issuance costs and corporate intangible assets, as well as
deferred tax assets.



              Three Months Ended                    Twelve Months Ended
              September30,  September30,  %       September30,  September30,  %
              2012           2011                   2012           2011
                                            Change                                Change
Net Sales:
Global        $   309.8      $   308.0      1%      $  2,539.2     $  2,533.2     0%
Consumer
Scotts        84.5           83.4           1%      245.8          235.6          4%
LawnService®
Segment total 394.3          391.4          1%      2,785.0        2,768.8        1%
Corporate &   6.9            11.7                   41.1           30.9
Other
Consolidated  $   401.2      $   403.1      0%      $  2,826.1     $  2,799.7     1%
Income (Loss)
from
Continuing
Operations
before Income
Taxes:
Global        $   (39.1)     $   (28.3)     38%     $  338.3       $  425.0       (20)%
Consumer
Scotts        22.1           23.2           (5)%    27.0           25.9           4%
LawnService®
Segment total (17.0)         (5.1)                  365.3          450.9
Corporate &   (23.9)         (18.0)                 (96.3)         (95.0)
Other
Intangible
asset         (3.4)          (2.5)                  (10.1)         (10.6)
amortization
Product
registration  (0.4)          (3.6)                  (8.2)          (14.6)
and recall
matters
Impairment,
restructuring —              (52.3)                 (7.1)          (55.9)
and other
charges
Costs related
to            —              —                      —              (1.2)
refinancing
Interest      (12.0)         (13.7)                 (61.8)         (51.0)
expense
Consolidated  $   (56.7)     $   (95.2)     (40)%   $  181.8       $  222.6       (18)%



THE SCOTTS MIRACLE-GRO COMPANY
Condensed Consolidated Balance Sheets
(in millions)
                                           September 30,
                                           2012        2011
ASSETS
Current assets:
Cash and cash equivalents                  $ 131.9     $ 130.9
Accounts receivable, net                   330.9       323.5
Inventories                                414.9       387.0
Prepaids and other current assets          122.3       151.1
Total current assets                       1,000.0     992.5
Property, plant and equipment, net         427.4       394.7
Goodwill                                   309.4       309.1
Intangible assets, net                     307.1       319.6
Other assets                               30.5        36.3
Total assets                               $ 2,074.4   $ 2,052.2
LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
Current portion of debt                    $ 1.5       $ 3.2
Accounts payable                           152.3       150.0
Other current liabilities                  279.8       315.4
Total current liabilities                  433.6       468.6
Long-term debt                             781.1       791.8
Other liabilities                          257.8       232.0
Total liabilities                          1,472.5     1,492.4
Shareholders' equity                       601.9       559.8
Total liabilities and shareholders' equity $ 2,074.4   $ 2,052.2



THE SCOTTS MIRACLE-GRO COMPANY
Reconciliation of Non- GAAP Disclosure Items (4)
(In millions, except per common share data)
(Unaudited)
               Three Months Ended September 30,  Three Months Ended September 30, 2011
               2012
                         Product                           Product      Impairment,
               As        Registration            As        Registration Restructuring
               Reported  and          Adjusted   Reported  and          and Other     Adjusted
                         Recall                            Recall       Charges
                         Matters                           Matters
Net sales      $ 401.2   $  —         $ 401.2    $ 403.1   $  —         $   —         $ 403.1
Cost of sales  296.2     —            296.2      289.3     —            —             289.3
Cost of sales
- impairment,
restructuring  —         —            —          18.3      —            18.3          —
and other
charges
Gross profit   105.0     —            105.0      95.5      —            (18.3)        113.8
% of sales     26.2%                  26.2%      23.7%                                28.2%
Operating
expenses:
Selling,
general and    148.6     —            148.6      136.4     —            —             136.4
administrative
Impairment,
restructuring  —         —            —          34.0      —            34.0          —
and other
charges
Product
registration   0.4       0.4          —          3.6       3.6          —             —
and recall
matters
Other expense, 0.7       —            0.7        3.0       —            —             3.0
net
Loss from      (44.7)    (0.4)        (44.3)     (81.5)    (3.6)        (52.3)        (25.6)
operations
% of sales     (11.1)%                (11.0)%    (20.2)%                              (6.4)%
Interest       12.0      —            12.0       13.7      —            —             13.7
expense
Loss from
continuing
operations     (56.7)    (0.4)        (56.3)     (95.2)    (3.6)        (52.3)        (39.3)
before income
taxes
Income tax
benefit from   (20.1)    (0.2)        (19.9)     (33.2)    (0.2)        (19.4)        (13.6)
continuing
operations
Loss from
continuing     $ (36.6)  $  (0.2)     $ (36.4)   $ (62.0)  $  (3.4)     $   (32.9)    $ (25.7)
operations
Basic loss per
share from     $ (0.60)  $  (0.01)    $ (0.59)   $ (1.00)  $  (0.06)    $   (0.53)    $ (0.41)
continuing
operations
Diluted loss
per share from $ (0.60)  $  (0.01)    $ (0.59)   $ (1.00)  $  (0.06)    $   (0.53)    $ (0.41)
continuing
operations
Common shares
used in basic  61.2      61.2         61.2       62.0      62.0         62.0          62.0
loss per share
calculation
Common shares
and potential
common shares
used in        61.2      61.2         61.2       62.0      62.0         62.0          62.0
diluted

loss per share
calculation
Calculation of
Adjusted
EBITDA:
Loss from
continuing     $ (36.6)                          $ (62.0)
operations
Income tax
benefit from   (20.1)                            (33.2)
continuing
operations
Loss from
discontinued
operations,
net of tax
               (3.5)                             (9.8)
(excluding
impact of the
gain on Global
Pro sale)
Income tax
benefit from
discontinued
operations
               (1.2)                             (5.2)
(excluding tax
impact of the
gain on Global
Pro sale)
Interest       12.0                              13.7
expense
Depreciation   11.9                              13.0
Amortization
(including     3.6                               2.7
Roundup)
Impairment,
restructuring  —                                 50.5
and other
charges
Product
registration   —                                 2.3
and recall
matters
Mark-to-market
adjustments on (1.0)                             0.5
derivatives
Adjusted       $ (34.9)                          $ (27.5)
EBITDA
Note: See accompanying footnotes at
the end of the release.



THE SCOTTS MIRACLE-GRO COMPANY
Reconciliation of Non- GAAP Disclosure Items (4)
(In millions, except per common share data)
(Unaudited)
               Twelve Months Ended September 30, 2012            Twelve Months Ended September 30, 2011
                          Product      Impairment,                          Product      Impairment,
               As         Registration Restructuring             As         Registration Restructuring
               Reported   and          and Other     Adjusted    Reported   and          and Other     Adjusted
                          Recall       Charges                              Recall       Charges
                          Matters                                           Matters
Net sales      $ 2,826.1  $  —         $   —         $ 2,826.1   $ 2,799.7  $  —         $   —         $ 2,799.7
Cost of sales  1,864.4    —            —             1,864.4     1,769.0    —            —             1,769.0
Cost of sales
- impairment,
restructuring  —          —            —             —           18.3       —            18.3          —
and other
charges
Cost of sales
- product
registration   0.4        0.4          —             —           3.2        3.2          —             —
and recall
matters
Gross profit   961.3      (0.4)        —             961.7       1,009.2    (3.2)        (18.3)        1,030.7
% of sales     34.0%                                 34.0%       36.0%                                 36.8%
Operating
expenses:
Selling,
general and    705.7      —            —             705.7       686.3      —            —             686.3
administrative
Impairment,
restructuring  7.1        —            7.1           —           37.6       —            37.6          —
and other
charges
Product
registration   7.8        7.8          —             —           11.4       11.4         —             —
and recall
matters
Other expense, (2.9)      —            —             (2.9)       (0.9)      —            —             (0.9)
net
Income from    243.6      (8.2)        (7.1)         258.9       274.8      (14.6)       (55.9)        345.3
operations
% of sales     8.6%                                  9.2%        9.8%                                  12.3%
Costs related  —          —            —             —           1.2        —            —             1.2
to refinancing
Interest       61.8       —            —             61.8        51.0       —            —             51.0
expense
Income from
continuing
operations     181.8      (8.2)        (7.1)         197.1       222.6      (14.6)       (55.9)        293.1
before income
taxes
Income tax
expense from   68.6       (0.8)        (2.8)         72.2        82.7       (2.6)        (20.6)        105.9
continuing
operations
Income from
continuing     $ 113.2    $  (7.4)     $   (4.3)     $ 124.9     $ 139.9    $  (12.0)    $   (35.3)    $ 187.2
operations
Basic income
per share from $ 1.86     $  (0.12)    $   (0.07)    $ 2.05      $ 2.16     $  (0.18)    $   (0.55)    $ 2.89
continuing
operations
Diluted income
per share from $ 1.82     $  (0.12)    $   (0.07)    $ 2.01      $ 2.11     $  (0.19)    $   (0.53)    $ 2.83
continuing
operations
Common shares
used in basic
income per     61.0       61.0         61.0          61.0        64.7       64.7         64.7          64.7
share
calculation
Common shares
and potential
common shares
used in        62.1       62.1         62.1          62.1        66.2       66.2         66.2          66.2
diluted income
per share
calculation
Calculation of
Adjusted
EBITDA:
Income from
continuing     $ 113.2                                           $ 139.9
operations
Income tax
expense from   68.6                                              82.7
continuing
operations
Loss from
discontinued
operations,
net of
tax(excluding (5.0)                                             (11.5)
 impact of
the gain on
Global Pro
sale)
Income tax
benefit from
discontinued
operations
           (2.0)                                             (7.2)
(excluding tax
impact of the
gain on Global
Pro sale)
Costs related  —                                                 1.2
to refinancing
Interest       61.8                                              51.0
expense
Interest
expense from   —                                                 1.7
discontinued
operations
Depreciation   51.5                                              50.3
Amortization
(including     10.9                                              11.4
Roundup)
Impairment,
restructuring  4.7                                               64.3
and other
charges
Product
registration   0.2                                               8.7
and recall
matters
Mark-to-market
adjustments on (1.0)                                             0.5
derivatives
Adjusted       $ 302.9                                           $ 393.0
EBITDA
Note: See accompanying footnotes at
the end of the release.





THE SCOTTS MIRACLE-GRO COMPANY
Footnotes to Preceding Financial Statements


    Basic income (loss) per common share amounts are calculated by dividing
(1) income from continuing operations, income (loss) from discontinued
    operations and net income by the weighted average number of common shares
    outstanding during the period.
    Diluted income (loss) per common share amounts are calculated by dividing
    income (loss) from continuing operations, income (loss) from discontinued
    operations and net income (loss) by the weighted average number of common
    shares, plus all potential dilutive securities (common stock options,
(2) stock appreciation rights, performance shares, performance units,
    restricted stock and restricted stock units) outstanding during the
    period. Since there is a loss for the three months ended September 30,
    2012 and 2011, potentially dilutive securities were not included in the
    calculations for those periods because to do so would have been
    anti-dilutive.
    On February 28, 2011, the Company completed the sale of a significant
    majority of the assets of its global professional business (excluding the
    non-European professional seed business, "Global Pro"). As a result of the
    then-pending sale, effective in the Company's first quarter of fiscal
(3) 2011, the Company reclassified the assets and liabilities of Global Pro to
    assets and liabilities held for sale and included the results of
    operations of Global Pro in discontinued operations for all periods
    presented.

    
    In the fourth quarter of fiscal 2012, the Company completed the wind down
    of substantially all operational activities of the Company's professional
    seed business. As a result, effective in its fourth quarter of fiscal
    2012, the Company classified its results of operations for fiscal 2012,
    2011 and 2010 to reflect the professional seed business as a discontinued
    operation.
    The Reconciliation of Non-GAAP Disclosure Items includes the following
    non-GAAP financial measures:

    Adjusted income (loss) from continuing operations and adjusted diluted
    income (loss) per share from continuing operations - These measures
(4) exclude charges or credits relating to impairments, restructurings,
    product registration and recall matters, discontinued operations and other
    unusual items such as costs or gains related to discrete projects or
    transactions that are apart from, and not indicative of, the results of
    the operations of the business.

    
    Adjusted EBITDA - This measure is calculated as net income (loss) before
    interest, taxes, depreciation and amortization as well as certain other
    items such as the impact of the cumulative effect of changes in
    accounting, costs associated with debt refinancing and other
    non-recurring, non-cash items affecting net income. In addition,
    non-recurring cash items affecting net income or loss that are incurred
    between April 3, 2011 and June 30, 2012 in an aggregate amount not to
    exceed $40 million are also excluded from the determination of adjusted
    EBITDA. We believe this measure provides additional information for
    determining our ability to meet debt service requirements. The
    presentation of adjusted EBITDA herein is intended to be consistent with
    the calculation of that measure as required by our borrowing arrangements,
    and used to calculate a leverage ratio (maximum of 3.50 at September 30,
    2012) and an interest coverage ratio (minimum of 3.50 for the twelve
    months ended September 30, 2012). The Company was in compliance with the
    terms of all debt covenants at September 30, 2012.

    
    The Company reports its financial results in accordance with U.S.
    generally accepted accounting principles (GAAP). However, management
    believes that certain non-GAAP financial measures used in managing the
    business may provide users of this financial information additional
    meaningful comparison between current results and results in prior
    operating periods. The Company believes that these non-GAAP financial
    measures are the most indicative of the Company's ongoing earnings
    capabilities and that disclosure of these non-GAAP financial measures
    therefore provides useful information to investors and other users of its
    financial statements, such as lenders. Non-GAAP financial measures should
    be viewed in addition to, and not as an alternative for, the Company's
    reported results prepared in accordance with GAAP.



SOURCE The Scotts Miracle-Gro Company

Website: http://www.scotts.com
Contact: Jim King, Senior Vice President, Investor Relations & Corporate
Affairs, +1-937-578-5622