WRAPUP 2-Strong U.S. dollar hits Alberto Culver, Energizer
* Alberto Q2 EPS 28 cents meets Wall Street's view
* Alberto sees gross margin increasing over time
* Energizer Q2 adj EPS $1.12 tops Street view by 3 cents
* Energizer sees forex hit of $90 mln-$100 mln
* Alberto shares down 5.4 pct; Energizer down 4.3 pct (Adds comments from Alberto conference call)
NEW YORK, April 27 (Reuters) - Alberto Culver Co (ACV.N) and Energizer Holdings Inc (ENR.N) gave muted outlooks for the rest of the year on Monday, as sales should remain weak and higher raw material costs and the stronger U.S. dollar continue to hurt results, sending shares of both household products makers lower.
"The category remains soft, and that hasn't changed in its totality," Alberto Culver Chief Executive Jim Marino said on a conference call. "I don't suspect that you're going to see a big shift in consumer behavior over the next few months."
Marino said consumers look for deals when they buy hair and skincare products. That trend is actually helping Alberto, whose brands include Alberto V05 and TRESemme, since they are less expensive than rival brands like Procter & Gamble's (PG.N) Pantene.
Alberto shares fell more than 5 percent in midday trade after the company said higher raw material costs will continue to pressure its margins. Alberto said it does not expect to see a year-over-year gross margin increase until the fourth quarter or the first quarter of next year.
BMO Capital Markets analyst Connie Maneaty said she did not think the margin declines were reflected in analysts' estimates.
"As the stock should be under pressure, we think a better buy point may emerge," Maneaty said in a research note.
Energizer said it expected battery consumption to remain weak for the foreseeable future as the recession continues.
The company, which also makes Schick razors and Playtex tampons, expects the stronger U.S. dollar, which reduces overseas sales, to shave $90 million to $100 million off operating profit in the second half of its fiscal year.
Maneaty guessed that the worse-than-expected foreign exchange hit would reduce Energizer's earnings per share by 15 cents for the rest of the year.
Energizer shares were down 4.3 percent even though the company posted higher-than-expected quarterly profit as cost cuts helped offset pressure from the stronger U.S. dollar and consumers trading down to cheaper batteries [ID:nN27427312]. Continued...
