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: October 31, 2000
ENERGIZER HOLDINGS, INC.
____________________________
(Exact name of Registrant as specified in its charter)
MISSOURI 1-15401 43-1863181
_________________________________________________________
(State or other (Commission (IRS Employer
Jurisdiction of File Number) Identification Number)
Incorporation)
800 CHOUTEAU AVENUE, ST. LOUIS, MISSOURI 63102
___________________________________________________________
(Address of Principal Executive Offices) (Zip Code)
(314) 982-2000
____________
(Registrant's telephone number, including area code)
Item 5. Other Events
The Company today issued the following press release:
St. Louis, Missouri, October 31, 2000 - Energizer Holdings, Inc, [NYSE: ENR],
today announced results of its fourth quarter and fiscal year ended September
30, 2000. Net earnings for the quarter were $36.6 million, or $0.38 per share,
compared to pro forma net earnings, before unusual items, of $35.0 million, or
$0.34 per share in last year's fourth quarter, a 5% increase in earnings and a
12% increase on a per share basis. Sales for the quarter were $478.0 million
compared to $485.0 million in last year's fourth quarter, a decrease of 1%.
Sales increases in North America were offset by declines in other world regions
due to unfavorable currency impacts, as well as volume declines in South and
Central America and Europe. Geographic segment income declined $9.8 million as
higher Asia Pacific results were more than offset by declines in other regions.
Lower segment income was more than offset by lower corporate expenses and lower
international net financing costs.
For the twelve months ended September 30, 2000, pro forma earnings, excluding
unusual items, were $163.1 million, or $1.69 per share, compared to $125.2
million, or $1.22 per share on a pro forma basis for the same period last year,
a 30% increase in earnings and a 39% increase on a per share basis. For the
year, the increase in earnings is primarily attributable to improved operating
results in North America and Asia Pacific and lower corporate expenses. Sales
for the twelve months were $1,914.3 million, a 2% increase from the same period
last year, reflecting growth in North America, partially offset by lower sales
in Europe, which were due primarily to declining currency values.
"For the important October through December battery selling season, we expect a
very difficult comparison due to last year's Y2K demand. Last year alkaline
category sales were up 28% versus historical increases in the 7% range," said J.
Patrick Mulcahy, chief executive officer. "As consumer takeaway returns to
normal historical trends, we anticipate that the category will experience a
decline compared to the exceptional growth in the last three months of 1999. In
the U.S., Energizer's total share at retail increased 2.0 share points to 33.7%
for the quarter and 1.7 share points to 32.9% for the year as measured by A.C.
Nielsen for the period ended October 7, 2000. If we can continue this momentum,
we are optimistic that we can capture a larger share of the category. Our
portfolio of products, Energizer e2 , Energizer and Eveready Alkaline, allows
us to meet the wide spectrum of our customers' needs and positions us well to
grow our share."
North America
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Net sales to customers for the fourth quarter increased $16.4 million, or 6%, on
incremental Energizer e2 sales. The increase was partially offset by a decline
in larger cell sized batteries and lighting product sales due to an active
hurricane season and Y2K driven sales last year, as well as unfavorable pricing
and product mix this year reflecting competitive activity in the market place.
Gross margin increased $1.3 million as Energizer e2 margin contribution was
moderated by production startup costs and sales declines described above. North
America's segment profit decreased $10.1 million, or 11%, for the quarter,
primarily on higher advertising related to the Energizer e2 launch and continued
support of the remainder of the Energizer and Eveready branded portfolio.
For the full year, net sales increased $86.1 million, or 8%, on higher volume,
partially offset by unfavorable pricing and product mix. Strong Y2K driven
demand early in the fiscal year and incremental Energizer e2 sales in the last
four months of the year account for the increased volume. The strong Y2K volume
was partially offset later in the year due to high trade and consumer pantry
inventories after the Y2K date change. Segment profit increased $20.5 million,
or 7%, on higher sales and lower production costs, partially offset by higher
advertising and promotion and marketing and distribution expenses.
Asia Pacific
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For the fourth quarter, net sales decreased $4.2 million, or 5%, primarily due
to currency devaluations. Excluding the currency impacts, sales increased
slightly as higher volumes in the region were nearly offset by unfavorable
pricing and product mix. Despite the decrease in sales, segment profit for Asia
Pacific increased $6.9 million, or 36%, for the quarter reflecting lower
production costs, advertising and promotion, and management costs.
For the full year, net sales increased $8.4 million, or 2%, due to alkaline
volume increases partially offset by currency devaluations. Segment profit for
the year increased $22.7 million, or 25%, on lower production costs combined
with higher sales. Lower production costs resulted from a variety of factors
including higher production facility utilization and lower costs as a result of
a plant closing in 1999.
Europe
------
Fourth quarter net sales decreased $14.4 million, or 21%, versus the same period
a year ago due to currency devaluations, carbon zinc volume declines and an
unfavorable adjustment related to estimates for promotional and rebate programs
recorded against net sales. Europe's segment results decreased $5.0 million
from the same period a year ago to a loss of $5.9 million in the fourth quarter.
The decrease in sales was primarily offset by lower production, advertising and
promotion and management costs.
For the full year, net sales decreased $44.3 million, or 14%, versus last year
primarily due to unfavorable currency impacts of $28.2 million and a $11.8
million decrease attributable to a decline in carbon zinc volume. In spite of
sales declines, segment results for the full year improved $1.0 million to a
loss of $0.2 million. Including offsetting positive impacts to costs, net
currency impacts were unfavorable $6.8 million. Absent currency impacts,
segment results improved $7.8 million, as impacts of lower sales were more than
offset by cost savings following a plant closing and other business realignment
last year.
South and Central America
----------------------------
Net sales declined $4.8 million in the fourth quarter versus last year primarily
on volume decline and currency devaluation. Segment profit for the quarter
declined $1.6 million, or 34%, as lower sales and higher advertising and
promotion were partially offset by lower production costs.
For the full year, net sales declined $8.2 million, or 6%, primarily on lower
carbon zinc volume and on currency devaluations that could not be mitigated
through pricing actions. Segment profit for the year declined $2.4 million, or
17%, as lower sales and higher management costs were partially offset by lower
production costs.
Corporate Expenses
-------------------
Net corporate expenses for the quarter decreased $11.0 million from the same
period a year ago. Last year's fourth quarter included a lighting product
recall charge and consulting and reorganization costs in anticipation of the
spin off.
For the year, corporate expenses decreased $15.5 million due to the fourth
quarter items described above as well as lower information systems expenses and
higher pension income throughout the year.
Historical Basis Results
--------------------------
In addition to pro forma results, Energizer also reported net earnings on a
historical basis for the year ended September 30, 2000. Net earnings were
$181.4 million, which includes after tax spin-off costs of $3.3 million, a loss
on the sale of Energizer's Spanish affiliate of $15.7 million and related
capital loss tax benefits of $24.4 million, and a net gain on disposition of
discontinued operations of $1.2 million. Net earnings for the year ended
September 30, 1999, were $80.0 million and include after tax provisions for
restructuring of $8.3 million, capital loss tax benefits related to prior
restructuring activities of $16.6 million, net loss from discontinued operations
of $5.6 million and net loss from disposition of discontinued operations of
$74.2 million. Discontinued operations represent the OEM rechargeable battery
business that was sold in November 1999. For the prior year quarter, net
earnings were $61.3 million, which included a net after tax restructuring charge
reversal of $6.3 million and capital loss tax benefits related to prior
restructuring activities of $13.3 million.
SEE ATTACHED SCHEDULE AND NOTES FOR ADDITIONAL INFORMATION ON THE FOURTH QUARTER
AND TWELVE MONTHS FOR BOTH YEARS.
# # #
Editors' note: On April 1, 2000, Ralston Purina Company distributed the
outstanding capital stock of Energizer in a tax-free spin-off to shareholders.
Energizer began trading on the New York Stock Exchange under the symbol ENR on
April 4, 2000. Pro forma earnings for periods prior to the spin off present
results assuming Energizer had been an independent company for those periods.
Statements in this press release that are not historical, particularly
statements regarding anticipated category trends and Energizer market share in
future periods, may be considered forward looking statements within the meaning
of the Private Securities Litigation Reform Act of 1995. The Company cautions
the readers not to place undue reliance on any forward-looking statements, which
speak only as of the date made. Technological or design changes in portable
electronic and other devices that utilize batteries as a power source may
significantly affect the demand for batteries. Continuing improvements in the
service life of primary batteries, improvements in rechargeable battery
performance and increasing consumer acceptance of rechargeable batteries, and
the development of new, non-alkaline battery technologies could all
significantly affect continued category growth for primary alkaline batteries.
General economic conditions and continuing growth in consumer demand for
portable electronic devices could also affect category growth. Within the
category, Energizer's market share may be negatively affected by competitive
activity, including new product introductions or advertising campaigns, retail
discounts and other promotional activities. Competition for key retail
customers, growth of the lower-priced private-label battery segment, and
significant penetration of the U.S. market by foreign battery manufacturers may
also negatively impact the Company's market share. The Company advises readers
to review various risks and uncertainties which may be detailed from time to
time in the Company's publicly-filed documents, including the Company's
Registration Statement on Form 10, as amended, its Quarterly Reports on Form 10Q
for the periods ended March 31, 2000 and June 30, 2000, 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/ Harry L. Strachan
Harry L. Strachan
Vice President and General Counsel
Dated: October 31, 2000
