* Keeps profit forecast due to restructuring savings
* To buy J&J's feminine care brands for $185 million
* Third-quarter profit per share of $1.57 tops Wall Street view
* Energizer to raise dividend by 25 percent
* Shares down 4.2 percent
By Jessica Wohl
July 31 (Reuters) - Energizer Holdings Inc said on Wednesday that two U.S. retailers planned to stop selling its batteries, adding pressure to its sagging sales.
Shares of Energizer fell, even as the company maintained its full-year profit forecast due to cost savings.
The company also said it planned to buy Johnson & Johnson's feminine care brands in the United States, Canada and the Caribbean for $185 million.
The acquisition of the o.b. tampon, Stayfree pad and Carefree liner product lines would give Energizer greater heft against Procter & Gamble Co and Kimberly-Clark Corp's feminine care brands.
Energizer said it expected sales in its household products division to fall by more than 10 percent in the current fiscal fourth quarter, largely because two U.S. retailers will no longer sell its batteries.
Shares of Energizer were down 4.2 percent at $100.54 in afternoon trading.
"The Energizer battery brand is caught in between the low-end brands like a Rayovac or private label, which are much cheaper, and the high-end brands like a Duracell, that is a little more expensive but spends a lot more on its brand," Bernstein analyst Ali Dibadj said.
Rayovac batteries are made by Spectrum Brands Holdings Inc , and Duracell batteries are made by Procter & Gamble .
Energizer reported a higher-than-expected profit for its fiscal third quarter despite a slight drop in sales, and it announced plans to raise its quarterly dividend by 25 percent to 50 cents a share.
While Energizer did not say which retailers were dropping its batteries, Family Dollar said this month that P&G's Duracell would become the only national battery brand in its stores.
Energizer Chief Executive Ward Klein, speaking on a conference call on Wednesday, suggested that the losses had to do with retailers that focus on one exclusive brand or the other, and said it is "not a new phenomenon."
Typically, warehouse club stores carry only one name brand, with Costco Wholesale Corp selling P&G's Duracell and Wal-Mart Stores Inc's Sam's Club selling Energizer.
Early last year, Energizer lost shelf space for batteries at the Walmart chain, which it said was a short-term issue.
Wal-Mart is Energizer's biggest customer, accounting for about 20 percent of the company's fiscal 2012 sales. Representatives for Wal-Mart's Walmart U.S. division and Sam's Club were not immediately available for comment.
While Energizer is best known for its batteries, it derives a larger percentage of sales and profits from its personal care products, such as Schick razors, Banana Boat sunscreen and Playtex tampons.
The acquisition of J&J's brands could help Energizer gain attention in the feminine care aisle, often dominated by P&G's Always and Tampax brands, and other rivals such as Kimberly's Kotex. Energizer entered the feminine care business in 2007, when it acquired Playtex Products Inc.
Energizer said it expected the deal, which includes a manufacturing plant in Montreal, to close this quarter and that it should add modestly to earnings next year. Goldman Sachs was the company's financial adviser on the acquisition.
J&J said it remains committed to its feminine care business outside of North America.
Energizer said it earned $87.2 million, or $1.38 per share, in the fiscal third quarter ended June 30, up from $70.2 million, or $1.06 per share, a year earlier.
Adjusted earnings, which exclude items such as restructuring costs, rose to $1.57 per share from $1.18 and topped analysts' average forecast of $1.32, according to Thomson Reuters I/B/E/S.
Sales slipped to $1.11 billion from $1.12 billion, missing the analysts' average forecast of $1.14 billion, as competitors' promotions and a wet summer curbed demand for products like suntan lotion.
Energizer said it still expected fiscal-year adjusted earnings of $6.75 to $7.00 per share, helped by additional savings from the restructuring it announced in November.
The St. Louis-based company's plans include cutting more than 10 percent of its workforce. It now expects to save more than $80 million this fiscal year, up from a May target of $50 million to $60 million.
After posting double-digit percentage increases in adjusted earnings per share for two years, Energizer said it expected to report mid-single-digit growth in fiscal 2014.