5
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report: January 27, 2003
ENERGIZER HOLDINGS, INC.
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(Exact name of Registrant as specified in its charter)
MISSOURI 1-15401 No. 43-1863181
(State or Other (Commission (IRS Employer
Jurisdiction of File Number) Identification
Incorporation) Number)
533 MARYVILLE UNIVERSITY DRIVE, ST. LOUIS, MO 63141
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(Address of Principal Executive Offices) (Zip Code)
(314) 985-2000
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(Registrant's telephone number, including area code)
Item 5. Other Events and Regulation FD Disclosure
The Company today issued the following press release:
ENERGIZER HOLDINGS, INC. ANNOUNCES FIRST QUARTER RESULTS
St. Louis, Missouri, January 27, 2003 - Energizer Holdings, Inc, [NYSE: ENR],
today announced results of its first quarter ended December 31, 2002. Net
earnings for the quarter were $86.4 million, or $0.95 per diluted share, versus
net earnings of $70.4 million, or $0.76 per share in the first fiscal quarter of
2001. The current quarter includes intellectual property rights income of $3.7
million, net of taxes, or $0.04 per share. Included in the prior quarter
earnings are restructuring provisions and related costs of $2.9 million, after
taxes, or $0.03 per share. Sales for the quarter were $572.4 million compared to
sales of $567.7 million in last year's first quarter, an increase of 1%, on
increases in the Europe and Asia Pacific regions, partially offset by declines
in South and Central America. Geographic segment income of $153.7 million was
essentially flat versus $153.1 million in the first quarter of last year, as
improvements in Europe were offset by declines in North America and South and
Central America. General corporate and other expenses declined $3.4 million,
and interest and other financing items declined $3.4 million.
"As expected the promotional environment in the U.S. remained intense throughout
the December quarter," said Pat Mulcahy, chief executive officer. "We continued
to manage our promotional spending efficiently. In January, one of our
competitors announced a list price reduction along with decreased promotional
spending. While we do not know the specific impact these actions will have on
retail pricing, we will continue our game plan of opportunistically managing our
trade spending to maximize profitability."
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North America
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Net sales to customers for the first quarter of $351.4 million were down
slightly, as lower alkaline volumes were nearly offset by increases in other
products. Alkaline unit volume for the quarter declined 5% while photo lithium
units increased 49% and other product lines increased at lesser rates.
In the U.S. retail alkaline category units grew an estimated 2% compared to the
same quarter last year, while category value declined 4%, reflecting continued
promotional discounting by retailers. Retail consumption of Energizer's
alkaline products decreased an estimated 2% in units and 8% in value. Energizer
estimates its share of the alkaline battery market at approximately 31% for the
quarter, a loss of approximately one share point compared to the same quarter
last year. Energizer believes that retail inventory levels at December 31,
2002, were generally at seasonal normal levels.
Gross margin for the quarter declined $2.6 million as the impact of lower volume
of higher margin alkaline product was partially offset by other products' margin
contribution and lower product costs. Segment profit declined $4.8 million on
lower gross margin and higher advertising and promotion expense.
Asia Pacific
Net sales for the quarter increased $3.6 million, or 4%, on higher volumes and
improved currency valuations offset by unfavorable pricing and product mix.
Segment profit of $21.6 million was flat as unfavorable pricing and product mix
were offset by higher volume, lower overhead spending and favorable currency
impacts.
Europe
First quarter net sales increased $6.2 million, or 7%, due to favorable currency
impacts of $8.2 million and improved pricing and product mix, partially offset
by lower carbon zinc volume. Segment profit improved $7.4 million, including
favorable currency impacts of $4.1 million, and higher prices.
South and Central America
Net sales for the quarter decreased $4.6 million, or 12%, due to negative
currency impacts of $11.3 million, partially offset by pricing actions. Segment
profit decreased $2.0 million, or 36%, due to lower sales in higher margin
markets.
Other Items
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Corporate and other expenses decreased $3.4 million, primarily reflecting lower
compensation costs relating to incentive plans and stock price offset by lower
pension income. Interest and other financing items decreased $3.4 million for
the quarter, reflecting lower average borrowings.
Income taxes were 36.0% for the quarter, compared to 39.9% for the same period
last year. The improvement in the tax rate is primarily due to improved foreign
operating results.
During the quarter, Energizer repurchased 643,200 shares of its common stock.
In addition, the company purchased 558,100 shares in January 2003 for a total of
1,201,300 shares purchased thus far in fiscal year 2003. Capital expenditures
and depreciation expense for the quarter were $5.9 million and $14.8 million,
respectively.
On January 21, Energizer announced that it has reached a definitive agreement to
purchase Schick-Wilkinson Sword from Pfizer Inc for $930 million. The company
expects the transaction to close in the spring.
# # #
Statements in this press release that are not historical, particularly
statements regarding estimates of category growth and Energizer's market share,
and retailer inventory levels, may be considered forward-looking statements
within the meaning of the Private Securities Litigation Reform Act of 1995.
Energizer cautions readers not to place undue reliance on any forward-looking
statements, which speak only as of the date made.
Energizer advises readers that various risks and uncertainties could affect its
financial performance and could cause Energizer's actual results for future
periods to differ materially from those anticipated or projected. Energizer's
estimates of battery category growth and value decline, and its estimates of the
total retail unit consumption of its battery products may be inaccurate, or may
not reflect significant segments of the retail market. Moreover, Energizer
sales volumes in future quarters may lag unit consumption if retailers are
currently carrying inventories in excess of Energizer's estimates, or if those
retailers elect to further contract their inventory levels. Additional risks
and uncertainties include those detailed from time to time in Energizer's
publicly filed documents, including Energizer's Registration Statement on Form
10, its Annual Report on Form 10-K for the Year ended September 30, 2002, and
its Current Report on Form 8-K dated April 25, 2000.
SIGNATURES:
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
ENERGIZER HOLDINGS, INC.
By: /s/ Daniel J. Sescleifer
Daniel J. Sescleifer
Executive Vice President and Chief Financial Officer
Dated: January 27, 2003