Energizer Fiscal-1st-Qtr. Sales, Net Hit By Y2K

Staff On Mar 12 2001 - 8:00am

ST. LOUIS -Pinning a decline in sales during its first fiscal quarter on the lack of Y2K-driven sales this year, aggressive inventory management by a number of retail customers, and currency devaluations in a number of key markets, Energizer Holdings reported a 46 percent decrease in net earnings-which fell to $54.2 million, compared with pro forma net earnings of $99.5 million in last year's first quarter.

Overall Energizer sales for the first quarter ended Dec. 31 were $558.7 million, an 18 percent drop from pro forma sales of $679.3 million in last year's first quarter.

Net sales in North America for the first quarter were $328.4 million, about 22 percent below the $421.4 million recorded on a pro forma basis in 1999. Volume declines accounted for about $68.5 million of the decrease, reflecting very difficult comparisons to last year's Y2K phenomenon. Lower pricing and product mix accounted for the remainder of the sales decline.

Gross margin decreased $59.3 million due to the sales declines. Segment profit in North America decreased $54.8 million as the gross margin decline was partially offset with lower advertising and promotion and marketing and distribution expenses.

Operating profit before unusual items and amortization dropped nearly 40 percent in North America during the first quarter, reaching $90.9 million, compared with $145.7 million on a pro forma basis in the year-ago three months.

Energizer's total U.S. retail market share climbed 1 percentage point to 34.4 percent for the 13-week period ended Dec. 30, according to ACNielsen data. For the 52-week period ended Dec. 30, retail market share rose 1.3 percentage points to 33.2 percent. Total alkaline battery sales were off 6 percent for the 13 weeks and 1 percent for the 52 weeks.