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UPDATE 2-Energizer profit beats Street view, revenue light
April 27, 2010 / 12:00 PM / 8 years ago

UPDATE 2-Energizer profit beats Street view, revenue light

* Q2 EPS ex-items $1.23 vs Street view $1.09

* Sales up 6.2 percent to $935.1 mln

* Shares slip 0.3 pct premarket (Adds details, background, changes dateline from NEW YORK)

CHICAGO, April 27 (Reuters) - Energizer Holdings Inc (ENR.N) reported a quarterly profit that beat Wall Street estimates, helped by favorable currency exchange rates and sales of its Edge and Skintimate shaving products.

However, the company’s revenue was weaker than expected and it cited a difficult battery market. Energizer and rival Duracell have opted to add more batteries to packages in the U.S. market, where consumers have been buying less expensive brands.

Energizer’s profit rose nearly 15 percent to $88.5 million in the fiscal second quarter that ended March 31, compared with $77 million a year earlier.

On a per share basis, earnings were $1.25, down from $1.30 a year earlier, because of an increase in shares outstanding after a May 2009 equity issue.

Total sales rose 6.2 percent to $935.1 million.

Excluding items, Energizer earned $1.23 per share, compared with the average analysts’ forecast of $1.09 earnings per share on sales of $973.1 million, according to Thomson Reuters I/B/E/S.

Energizer’s batteries, Schick razors and Playtex tampons compete against the Duracell, Gillette and Tampax products sold by Procter & Gamble Co (PG.N). Schick’s Hydro razor hit stores this month, while P&G will introduce updated version of the popular Gillette Fusion line in June.

Sales in Energizer’s household products business, which includes batteries, rose 6 percent to $441.8 million, and by the same percentage to $493.3 million in the personal care business that was boosted by the June purchase of the Skintimate and Edge business.

The company called the battery category challenging, saying an increasing number of devices are using built-in rechargeable battery systems, particularly in developed markets. That, along with aggressive competition, could put additional pressure on the segment’s results going forward.

Energizer said it continues to expect its spending on advertising and promotion in fiscal 2010 to be up in the range of 11 to 12 percent of net sales due in part to the support for the April 6 launch of the Hydro in North America and increased spending behind Edge and Skintimate. Those costs were 8.2 percent in the second quarter.

It estimated currencies will boost operating profit by about $15 million to $20 million through the balance of the year, excluding Venezuela.

Shares of Energizer were off slightly to $62.00 in premarket trading from Monday’s closing price on the New York Stock Exchange of $62.18. (Reporting by Ben Klayman in Chicago; additional reporting by Phil Wahba in New York, editing by Dave Zimmerman)

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