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Responding to heightened security alerts preceding and at the start of the Iraqi war, consumers stocked their homes with batteries, helping first quarter sales at Duracell climb 16 percent, to $384 million, for the period ending March 31.
Duracell battery business also moved into the black during the first three months, hitting a profit of $39 million, compared with a $1 million loss in the year-ago period.
As consumers work down the battery inventories, accumulated because of security reasons, Duracell's parent Gillette said it anticipates a moderation of demand for its segment's batteries during the balance of the year.
The company also is concerned about competitive actions that could continue to deflate the battery category, hurting retailers and manufacturers.
At the same time, Gillette said it remains fully committed to a Duracell strategy that will restore segment growth through increased equity-building programs, a reduction in prices and promotion and the elimination of free-cell giveaways.
In addition to increased consumer sales during the first quarter, Duracell enjoyed incremental battery sales to the military. Restraining growth was the impact of lower pricing associated with the company's U.S. price-deal realignment program.
Consolidated first quarter Gillette net sales climbed 14 percent, hitting $2 billion, up from $1.7 billion in the same three months in 2002. Consolidated net income for the quarter increased 18 percent, reaching $263 million, up from $223 million year-on-year.
This TWICE webinar, hosted by senior editor Alan Wolf, will take a look at what may be the hottest CE products at retail that will be sold during the all-important fourth quarter. Top technologies, market strategies and industry trends will be discussed with industry analysts and executives.