Energizer N.A. Battery Sales Increase 7%

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St. Louis — An 11 percent increase in alkaline battery volume helped boost fiscal third-quarter North America battery segment sales for Energizer Holdings by 7 percent to $228.5 million from $213.8 million in the year-ago period.

Higher sales, partially offset by higher raw materials costs and advertising expenses, pushed the North America battery segment profit to $55.3 million in the fiscal third-quarter, ended June 30, up from $49.3 million in the same three months a year ago.

In the United States, retail alkaline category units were nearly flat, compared with the same quarter last year, while category value sales declined 3 percent, said Energizer. Retail consumption of alkaline products increased an estimated 4 percent in units and 1 percent in value for the quarter. The negative price mix primarily is due to a channel shift from food and drug stores to accounts that sell larger pack sizes.

Energizer estimated its share of the alkaline battery market at about 32 percent in the third quarter, up about one point year-on-year.

Overall net sales of alkaline batteries in the third quarter hit $271.1 million, compared with $242.7 million in the same period in 2003. For the nine months, alkaline battery sales came in at $927.8 million, compared with $885.7 million year-over-year.

For the nine months, North America battery segment sales climbed 4 percent, hitting $785.9 million, up from $755.5 million in the same three months in 2003. This was due to higher volume, a favorable Canadian currency translation and higher net pricing.

Segment profit for the nine months rose to $209.3 million, compared with $205.1 million the previous year. Absent currency effects, higher segment profit from increased sales was nearly offset by higher raw materials costs, advertising, promotion and overhead expenses.

Energizer said it has de-emphasized battery promotions that move units purely on a discount basis, and is increasing media advertising to optimize the long-term financial performance of its business.

With top-line growth healthy in its battery and shaving businesses, Energizer, which also owns the Schick Wilkinson Sword razor blade business, saw a 10 percent rise in consolidated sales, reaching $651.9 million in the third quarter, from $594 million year-on-year.

Consolidated third quarter net earnings hit $38.7 million in the third quarter, compared with $17.5 million in the same period the previous year.

For the nine months, consolidated sales jumped 34 percent to $2.1 billion from $1.5 billion. Net earnings were $207.1 million for the nine months, up from $136.9 million year-over-year.

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