Energizer Holdings, Inc. Announces Second Quarter Results

Apr 26, 2001, 01:00 ET from Energizer Holdings, Inc.

    ST. LOUIS, Mo., April 26 /PRNewswire/ -- Energizer Holdings, Inc,
 (NYSE:   ENR), today announced results of its second quarter ended March 31,
 2001.  Net earnings for the quarter were $5.6 million, or $0.06 per diluted
 share, compared to a pro forma net loss, excluding unusual items, of
 $1.2 million, or $0.01 per share, in last year's second quarter.(a)  Sales for
 the quarter were $351.9 million compared to pro forma sales of $335.4 million
 in last year's second quarter, an increase of 5%.  The sales growth was
 attributable to increased volumes in North America versus last year's low,
 post-Y2K demand.  Volume growth was partially offset by currency devaluation
 in a number of key markets.  Geographic segment income increased $4.8 million
 on higher North American results, partially offset by declines in other
 regions.  General corporate expenses declined $4.8 million and research and
 development declined $3.0 million while interest and other financing items
 increased $1.4 million.
     For the six months ended March 31, 2001, net earnings were $59.8 million,
 or $0.63 per diluted share compared to pro forma net earnings, excluding
 unusual items, of  $98.3 million, or  $1.02 per diluted share for the same
 period last year, a 39% decline in earnings and a 38% decline on a per share
 basis.  Sales for the six months declined 10% to $910.6 million due to
 currency devaluation, lower volume versus the difficult comparison in last
 year's Y2K-driven demand in the first quarter, as well as unfavorable pricing
 and product mix.  Segment profit declined $67.9 million, or 28% on lower
 sales, partially offset by lower costs.  General corporate expenses declined
 $7.4 million and research and development declined $3.6 million while interest
 and other financing costs increased $3.4 million.
     As of March 31, 2001, Energizer had $464.8 million of debt.   During the
 quarter, Energizer repurchased 1.5 million shares of its common stock for a
 total of 3.8 million shares purchased in the first half of fiscal year 2001.
 Capital expenditures for the quarter were $18.8 million, and depreciation
 expense was $15.0 million.
 
     North America
     Net sales to customers for the second quarter increased $28.3 million, or
 18%.  Volume increases were partially offset by unfavorable pricing and
 product mix reflecting higher promotional spending.  Gross profit increased
 $18.0 million for the quarter on higher sales and lower product costs.
 Segment profit increased $13.5 million as the gross profit increase was
 partially offset by increased advertising and promotion expenses and other
 costs.
     For the six months, net sales decreased $64.7 million, or 11%, on lower
 volume compared to the strong Y2K demand last year, as well as unfavorable
 pricing and product mix this year.  Segment profit decreased $41.3 million on
 lower sales, partially offset by lower product cost.
     As measured by A.C. Nielsen, Energizer's total U.S. share at retail
 increased 0.2 share points to 32.3% for the 13-week period ended March 31,
 2001, and increased 1.0 share points to 33.1% for the 52-week period ended
 March 31, 2001 versus the same period last year.  Total alkaline battery
 category sales increased 8.8% for the 13 weeks ended March 31, 2001, compared
 to the same period last year.
 
     Asia Pacific
     For the second quarter, net sales decreased $7.8 million, or 9%, with
 currency devaluation accounting for $7.4 million.  Segment profit declined
 $3.8 million, or 21%, with currency devaluation accounting for $4.3 million.
 Lower sales were partially offset by lower advertising and promotion and
 overhead expenses.
     For the six months, sales declined $23.5 million, or 12%.  Currency
 devalution accounted for $16.3 million of the decline with lower volumes,
 primarily carbon zinc, and unfavorable pricing and product mix accounting for
 the remainder.  Segment profit declined $12.9 million, or 24%, with currency
 accounting for $9.5 million.  Lower sales were partially offset by lower
 advertising and promotion and overhead expenses.
 
     Europe
     Net sales decreased $7.5 million, or 12%, for the quarter, with currency
 devaluation accounting for $3.5 million of the decline.  Alkaline volume
 increases in the quarter were more than offset by heavy promotional spending
 and lower carbon zinc volume.  Segment profit declined $3.6 million, on lower
 sales, with currency accounting for $2.6 million of the decline.  Absent the
 currency decline, segment results decreased $1.0 million, as lower sales were
 partially offset by lower advertising and promotion expense.
     For the six months, sales declined $19.1 million, or 12%, primarily due to
 $18.6 million of currency devaluation.  Volume increases were offset by
 unfavorable pricing and product mix.  Segment profit decreased $11.1 million,
 with currency accounting for $10.0 million of the decline.  Absent currencies,
 sales declines were partially offset by lower product and management costs.
 
     South and Central America
     Net sales in the quarter increased $3.5 million, or 13%, on higher
 alkaline volume and improved pricing and product mix, partially offset by
 currency devaluation.  Segment profit decreased $1.3 million, or 57%, on
 increased product and management costs.
     For the six months, net sales increased $3.2 million, or 5%, on increased
 volume and favorable pricing and product mix, partially offset by currency
 devaluation.  Segment profit declined $2.6 million, or 28%, on higher product
 and management costs.
 
     Corporate Expense, Research and Development and Financing Costs
     Corporate expenses declined $4.8 million in the quarter reflecting
 favorable profit in inventory adjustments due to reductions in intercompany
 inventory levels within the geographic segments, as well as higher pension
 income.  Research and development expenses declined $3.0 million in the
 quarter compared to a relatively high spending level in the last year's second
 quarter.  Interest and other financing items increased $1.4 million reflecting
 lower net, currency exchange gains.
     For the six months, general corporate expenses declined $7.4 million due
 to factors discussed in the previous paragraph and higher royalty income,
 partially offset by higher management expenses.  Research and development
 decreased $3.6 million for the six months, primarily on lower spending in the
 quarter.  Interest and other financing items increased $3.4 million due to
 lower net, currency exchange gains.
 
     Historical Basis Results
     In addition to pro forma results, Energizer also reported net earnings
 from continuing operations of $15.7 million on a historical basis for the
 second quarter ended March 31, 2000.  Excluding one time costs of $3.3 million
 relating to the spin-off and a loss on the sale of Energizer's Spanish
 affiliate of $15.7 million and related capital loss tax benefits of
 $24.4 million, Energizer's historical earnings for the quarter would have been
 $10.3 million.
     For the six months ended March 31, 2000, net earnings from continuing
 operations on a historical basis were $120.4 million.  Absent the special
 items described above, net earnings from continuing operations would have been
 $115.0 million.
     See attached schedule and notes for additional information on the second
 fiscal quarters and year-to-date of 2000 and 2001.
 
 
 
                              ENERGIZER HOLDINGS, INC.
                               STATEMENT OF EARNINGS
                                    (Condensed)
              (Dollars in millions, except per share data - Unaudited)
 
 
                                                       Pro Forma     Historical
                                                       Basis (a)       Basis
                                            Quarter     Quarter       Quarter
                                             Ended       Ended         Ended
                                            March 31,   March 31,     March 31,
                                               2001        2000          2000
 
     Net Sales                                $351.9      $335.4        $359.9
 
     Costs and Expenses
       Cost of products sold                   189.6       179.6         192.6
       Selling, general and administrative     100.0       102.8         101.1
       Advertising and promotion                32.4        33.0          33.9
       Research and development                 11.1        14.1          14.2
       Costs related to spin-off                 -           5.5           5.5
       Loss on disposition of Spanish
        affiliate                                -          15.7          15.7
       Interest expense                          8.8        10.8           2.9
       Other financing items, net                0.5        (2.9)         (1.9)
                                               342.4       358.6         364.0
 
     Earnings (Loss) from Continuing
      Operations before Income Taxes             9.5       (23.2)         (4.1)
 
     Income Taxes                               (3.9)        3.0          19.8
 
     Earnings (Loss) from Continuing
      Operations                                $5.6      $(20.2) *      $15.7
 
     Net Gain on Disposition of
      Discontinued Operations                                              1.2
 
     Net Earnings                                                        $16.9
 
     Earnings Per Share
       Basic and Diluted - Earnings from
        Continuing Operations                  $0.06      $(0.21) *      $0.17
 
     Weighted average shares of common
      stock - Basic                             92.2        96.0          96.0
     Weighted average shares of common
      stock - Diluted                           94.1        96.0          96.0
 
     * Excluding after-tax costs related to the spin-off of $3.3 or $.04 per
       share, and the loss on the disposition of Spanish affiliate of $15.7 or
       $.16 per share, pro forma net loss and loss per share would have been
       $(1.2) and $(.01) for the quarter ended March 31, 2000.
 
 
 
                                                      Pro Forma      Historical
                                                      Basis (a)        Basis
                                          Six Months  Six Months     Six Months
                                            Ended       Ended          Ended
                                          March 31,   March 31,      March 31,
                                             2001       2000           2000
 
     Net Sales                              $910.6    $1,014.7       $1,033.5
 
     Costs and Expenses
       Cost of products sold                 481.6       506.4          514.8
       Selling, general and administrative   192.3       202.5          198.3
       Advertising and promotion              91.6       101.0          101.5
       Research and development               22.6        26.2           26.1
       Costs related to spin-off               -           5.5            5.5
       Loss on disposition of Spanish
        affiliate                              -          15.7           15.7
       Interest expense                       18.7        22.3            5.5
       Other financing items, net              1.6        (5.4)          (3.5)
                                             808.4       874.2          863.9
 
     Earnings from Continuing Operations
      before Income Taxes                    102.2       140.5          169.6
 
     Income Taxes                            (42.4)      (61.2)         (49.2)
 
     Earnings from Continuing Operations      59.8        79.3 **       120.4
 
     Net Gain on Disposition of
      Discontinued Operations                                             1.2
 
     Net Earnings                                                      $121.6
 
     Earnings Per Share From Continuing
      Operations
       Basic                                 $0.64       $0.82 **       $1.24
       Diluted                               $0.63       $0.82 **       $1.24
 
 
     Weighted average shares of common
      stock - Basic                           93.5        96.7           96.7
     Weighted average shares of common
      stock - Diluted                         95.0        96.7           96.7
 
     ** Excluding after-tax costs related to the spin-off of $3.3 or $.04 per
        share, and the loss on the disposition of Spanish affiliate of $15.7 or
        $.16 per share, pro forma net earnings and earnings per share would
        have been $98.3 and $1.02 for the six months ended March 31, 2000.
 
    (a) For comparable purposes with the current quarter and six month results,
        pro forma results for the quarter and six months ended March 31, 2000
        have been adjusted to reflect the impact of the spin-off from Ralston
        Purina Company and the elimination of a one month lag in reporting of
        Energizer's international operations.  See further discussion in
        Note 2.
 
             See Accompanying Notes to Condensed Financial Statements.
 
 
 
                              Energizer Holdings, Inc.
                      Notes to Condensed Financial Statements
                    (Dollars in millions, except per share data)
 
 
 
     1. On April 1, 2000, Ralston Purina Company (Ralston) distributed the
        common stock of its wholly owned subsidiary, Energizer Holdings, Inc.
        (Energizer), to the shareholders of Ralston's common stock through a
        tax-free spin-off.  Following the spin-off, Energizer has conducted its
        business as a separate public company.
 
     2. Prior to fiscal 2001, Energizer's international operations reported
        their results of operations on a one month lag, which allowed more time
        to compile results.  Energizer has taken steps to improve its internal
        reporting procedures that has allowed for more timely reporting of
        these operations.  Beginning in the first quarter of fiscal year 2001,
        the one month lag was eliminated.  The change affected the quarterly
        reporting periods for these operations and thus the pro forma statement
        of earnings has been presented to show comparable results for the
        quarter as if the change would have occurred in the prior year.  The
        September 2000 loss from international operations of $3.3 was recorded
        directly to retained earnings.
 
     3. Operating results for any quarter are not necessarily indicative of the
        results for any other quarter or the full year.
 
     4. Basic earnings per share is based on the weighted-average number of
        shares outstanding during the period.  Diluted earnings per share is
        based on the weighted-average number of shares used in the basic
        earnings per share calculation, adjusted for the dilutive effect of
        stock options and restricted stock equivalents.  Prior year earnings
        per share calculations are based on the weighted-average number of
        Ralston shares outstanding prior to the spin-off, adjusted for the
        distribution of one share of Energizer stock for each three shares of
        Ralston stock.
 
     5. The pro forma statements of earnings reflect the results of operations
        for the quarter and six months ended March 31, 2000 as if the spin-off
        had occurred at the beginning of such periods.  Such statements have
        been prepared by adjusting the historical statements for the effects of
        costs, expenses, assets and liabilities and the recapitalization which
        might have occurred had the spin-off been effected as of the dates
        indicated.  These pro forma financial statements may not necessarily
        reflect the consolidated results of operations that would have existed
        had the spin-off occurred on the dates indicated.
 
        Pro forma adjustments to selling, general and administrative expenses
        include incremental costs of $2.0 and $4.0 for the quarter and six
        months ended March 31, 2000, respectively, associated with becoming a
        stand-alone company, adjustments of $.4 and $.8 for the quarter and six
        months, respectively, to pension income based on the plan assets
        transferred to Energizer in connection with the spin-off and
        adjustments of $(.4) and $(.8) for the quarter and six months,
        respectively, to eliminate certain postretirement benefits costs
        retained by Ralston.
 
        Pro forma adjustments to increase interest expense by $8.2 and $17.1
        for the quarter and six months, respectively, reflects the increased
        debt levels assumed prior to the spin-off.
 
        The pro forma adjustment to increase income tax expense consists of
        adjustments of $26.7 and $23.4 for the quarter and six months,
        respectively,  to reflect income taxes as if Energizer was a single,
        stand-alone tax payer and adjustments of $(6.3) and $(8.4) for the
        quarter and six months, respectively, for the tax effect of the pro
        forma adjustments discussed above.   As discussed in Note 7 below,
        capital loss benefits of $24.4 in the prior year quarter and six months
        are not reflected in the pro forma tax provision.
 
        The pro forma statements of earnings for the quarter and six months
        ended March 31, 2000 have been adjusted to reflect the elimination of
        the one month lag in reporting international results of operations as
        discussed in Note 2 above.
 
     6. The prior year quarter and six month historical and pro forma results
        include one-time spin related costs of $5.5 pre-tax, or $3.3 after-tax.
        These costs include legal fees, charges related to the vesting of
        certain compensation benefits and other costs triggered by or
        associated with the spin-off.
 
     7. The prior year quarter and six month historical and pro forma
        results include a non-cash loss of $15.7 related to the sale of
        Energizer's Spanish affiliate.  Related capital loss benefits of
        $24.4 are included in the historical basis financial statements, but
        have been removed from the pro forma basis statement of earnings
        because such capital loss benefits may not have been realized by
        Energizer on a stand-alone basis.
 
     8. Discontinued operations consist of the Company's worldwide rechargeable
        Original Equipment Manufacturers' battery business, which was sold
        November 1, 1999.  The historical results for the prior year quarter
        and six months include after-tax income of $1.2 related to the final
        settlement of the sale transaction.
 
     9. Segment sales and profitability for the current and prior quarter and
        six month periods ended March 31, 2001 and 2000, respectively, are
        presented below.  The operating profit for the prior year quarter and
        six months ended March 31, 2000, are presented on a pro forma basis
        reflecting the impact of the spin-off from Ralston Purina Company and
        the elimination of the one month lag in reporting international results
        of operations as discussed in Note 2 above.
 
 
     Net External Sales     Quarter Ended March 31,  Six Months Ended March 31,
                              2001          2000         2001          2000
 
        North America        $188.8        $160.5       $517.2        $581.9
        Asia Pacific           78.7          86.5        179.6         203.1
        Europe                 54.3          61.8        140.5         159.6
        South and Central
         America               30.1          26.6         73.3          70.1
           Total
            External
            Sales            $351.9        $335.4        $910.6     $1,014.7
 
 
                             Quarter Ended March 31, Six Months Ended March 31,
                              2001          2000         2001         2000
 
     Operating Profit before
      Unusual Items and
      Amortization
        North America         $37.8         $24.3       $128.7        $170.0
        Asia  Pacific          14.7          18.5         41.8          54.7
        Europe                 (7.0)         (3.4)        (5.9)          5.2
        South and Central
         America                1.0           2.3          6.7           9.3
           Total Segment
            Profitability      46.5          41.7        171.3         239.2
 
        General Corporate
         Expenses             (10.9)        (15.7)       (14.9)        (22.3)
        Research and
         Development
         Expense              (11.1)        (14.1)       (22.6)        (26.2)
            Operating
             Profit
             before
             Unusual
             Items and
             Amortization      24.5          11.9        133.8         190.7
        Costs related to
         spin-off                 -          (5.5)           -          (5.5)
        Loss on
         disposition of
         Spanish affiliate
                                  -         (15.7)           -         (15.7)
        Amortization of
         intangibles           (5.7)         (6.0)       (11.3)        (12.1)
        Interest and Other
         Financial Items       (9.3)         (7.9)       (20.3)        (16.9)
           Earnings from
           Continuing
           Operations
           Before Income
           Taxes               $9.5        $(23.2)      $102.2        $140.5
 
 
 
     Supplemental product information is presented below for revenues from
     external customers.
 
     Net Sales              Quarter Ended March 31,  Six Months Ended March 31,
                             2001          2000          2001         2000
 
     Alkaline Batteries     $218.0        $188.3       $616.2        $675.9
     Carbon Zinc Batteries    61.1          71.8        142.5         172.9
     Lighting Products        25.9          27.7         57.4          71.1
     Miniature Batteries      17.2          14.6         33.7          32.0
     Other                    29.7          33.0         60.8          62.8
        Total Net Sales     $351.9        $335.4       $910.6      $1,014.7
 
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SOURCE Energizer Holdings, Inc.
    ST. LOUIS, Mo., April 26 /PRNewswire/ -- Energizer Holdings, Inc,
 (NYSE:   ENR), today announced results of its second quarter ended March 31,
 2001.  Net earnings for the quarter were $5.6 million, or $0.06 per diluted
 share, compared to a pro forma net loss, excluding unusual items, of
 $1.2 million, or $0.01 per share, in last year's second quarter.(a)  Sales for
 the quarter were $351.9 million compared to pro forma sales of $335.4 million
 in last year's second quarter, an increase of 5%.  The sales growth was
 attributable to increased volumes in North America versus last year's low,
 post-Y2K demand.  Volume growth was partially offset by currency devaluation
 in a number of key markets.  Geographic segment income increased $4.8 million
 on higher North American results, partially offset by declines in other
 regions.  General corporate expenses declined $4.8 million and research and
 development declined $3.0 million while interest and other financing items
 increased $1.4 million.
     For the six months ended March 31, 2001, net earnings were $59.8 million,
 or $0.63 per diluted share compared to pro forma net earnings, excluding
 unusual items, of  $98.3 million, or  $1.02 per diluted share for the same
 period last year, a 39% decline in earnings and a 38% decline on a per share
 basis.  Sales for the six months declined 10% to $910.6 million due to
 currency devaluation, lower volume versus the difficult comparison in last
 year's Y2K-driven demand in the first quarter, as well as unfavorable pricing
 and product mix.  Segment profit declined $67.9 million, or 28% on lower
 sales, partially offset by lower costs.  General corporate expenses declined
 $7.4 million and research and development declined $3.6 million while interest
 and other financing costs increased $3.4 million.
     As of March 31, 2001, Energizer had $464.8 million of debt.   During the
 quarter, Energizer repurchased 1.5 million shares of its common stock for a
 total of 3.8 million shares purchased in the first half of fiscal year 2001.
 Capital expenditures for the quarter were $18.8 million, and depreciation
 expense was $15.0 million.
 
     North America
     Net sales to customers for the second quarter increased $28.3 million, or
 18%.  Volume increases were partially offset by unfavorable pricing and
 product mix reflecting higher promotional spending.  Gross profit increased
 $18.0 million for the quarter on higher sales and lower product costs.
 Segment profit increased $13.5 million as the gross profit increase was
 partially offset by increased advertising and promotion expenses and other
 costs.
     For the six months, net sales decreased $64.7 million, or 11%, on lower
 volume compared to the strong Y2K demand last year, as well as unfavorable
 pricing and product mix this year.  Segment profit decreased $41.3 million on
 lower sales, partially offset by lower product cost.
     As measured by A.C. Nielsen, Energizer's total U.S. share at retail
 increased 0.2 share points to 32.3% for the 13-week period ended March 31,
 2001, and increased 1.0 share points to 33.1% for the 52-week period ended
 March 31, 2001 versus the same period last year.  Total alkaline battery
 category sales increased 8.8% for the 13 weeks ended March 31, 2001, compared
 to the same period last year.
 
     Asia Pacific
     For the second quarter, net sales decreased $7.8 million, or 9%, with
 currency devaluation accounting for $7.4 million.  Segment profit declined
 $3.8 million, or 21%, with currency devaluation accounting for $4.3 million.
 Lower sales were partially offset by lower advertising and promotion and
 overhead expenses.
     For the six months, sales declined $23.5 million, or 12%.  Currency
 devalution accounted for $16.3 million of the decline with lower volumes,
 primarily carbon zinc, and unfavorable pricing and product mix accounting for
 the remainder.  Segment profit declined $12.9 million, or 24%, with currency
 accounting for $9.5 million.  Lower sales were partially offset by lower
 advertising and promotion and overhead expenses.
 
     Europe
     Net sales decreased $7.5 million, or 12%, for the quarter, with currency
 devaluation accounting for $3.5 million of the decline.  Alkaline volume
 increases in the quarter were more than offset by heavy promotional spending
 and lower carbon zinc volume.  Segment profit declined $3.6 million, on lower
 sales, with currency accounting for $2.6 million of the decline.  Absent the
 currency decline, segment results decreased $1.0 million, as lower sales were
 partially offset by lower advertising and promotion expense.
     For the six months, sales declined $19.1 million, or 12%, primarily due to
 $18.6 million of currency devaluation.  Volume increases were offset by
 unfavorable pricing and product mix.  Segment profit decreased $11.1 million,
 with currency accounting for $10.0 million of the decline.  Absent currencies,
 sales declines were partially offset by lower product and management costs.
 
     South and Central America
     Net sales in the quarter increased $3.5 million, or 13%, on higher
 alkaline volume and improved pricing and product mix, partially offset by
 currency devaluation.  Segment profit decreased $1.3 million, or 57%, on
 increased product and management costs.
     For the six months, net sales increased $3.2 million, or 5%, on increased
 volume and favorable pricing and product mix, partially offset by currency
 devaluation.  Segment profit declined $2.6 million, or 28%, on higher product
 and management costs.
 
     Corporate Expense, Research and Development and Financing Costs
     Corporate expenses declined $4.8 million in the quarter reflecting
 favorable profit in inventory adjustments due to reductions in intercompany
 inventory levels within the geographic segments, as well as higher pension
 income.  Research and development expenses declined $3.0 million in the
 quarter compared to a relatively high spending level in the last year's second
 quarter.  Interest and other financing items increased $1.4 million reflecting
 lower net, currency exchange gains.
     For the six months, general corporate expenses declined $7.4 million due
 to factors discussed in the previous paragraph and higher royalty income,
 partially offset by higher management expenses.  Research and development
 decreased $3.6 million for the six months, primarily on lower spending in the
 quarter.  Interest and other financing items increased $3.4 million due to
 lower net, currency exchange gains.
 
     Historical Basis Results
     In addition to pro forma results, Energizer also reported net earnings
 from continuing operations of $15.7 million on a historical basis for the
 second quarter ended March 31, 2000.  Excluding one time costs of $3.3 million
 relating to the spin-off and a loss on the sale of Energizer's Spanish
 affiliate of $15.7 million and related capital loss tax benefits of
 $24.4 million, Energizer's historical earnings for the quarter would have been
 $10.3 million.
     For the six months ended March 31, 2000, net earnings from continuing
 operations on a historical basis were $120.4 million.  Absent the special
 items described above, net earnings from continuing operations would have been
 $115.0 million.
     See attached schedule and notes for additional information on the second
 fiscal quarters and year-to-date of 2000 and 2001.
 
 
 
                              ENERGIZER HOLDINGS, INC.
                               STATEMENT OF EARNINGS
                                    (Condensed)
              (Dollars in millions, except per share data - Unaudited)
 
 
                                                       Pro Forma     Historical
                                                       Basis (a)       Basis
                                            Quarter     Quarter       Quarter
                                             Ended       Ended         Ended
                                            March 31,   March 31,     March 31,
                                               2001        2000          2000
 
     Net Sales                                $351.9      $335.4        $359.9
 
     Costs and Expenses
       Cost of products sold                   189.6       179.6         192.6
       Selling, general and administrative     100.0       102.8         101.1
       Advertising and promotion                32.4        33.0          33.9
       Research and development                 11.1        14.1          14.2
       Costs related to spin-off                 -           5.5           5.5
       Loss on disposition of Spanish
        affiliate                                -          15.7          15.7
       Interest expense                          8.8        10.8           2.9
       Other financing items, net                0.5        (2.9)         (1.9)
                                               342.4       358.6         364.0
 
     Earnings (Loss) from Continuing
      Operations before Income Taxes             9.5       (23.2)         (4.1)
 
     Income Taxes                               (3.9)        3.0          19.8
 
     Earnings (Loss) from Continuing
      Operations                                $5.6      $(20.2) *      $15.7
 
     Net Gain on Disposition of
      Discontinued Operations                                              1.2
 
     Net Earnings                                                        $16.9
 
     Earnings Per Share
       Basic and Diluted - Earnings from
        Continuing Operations                  $0.06      $(0.21) *      $0.17
 
     Weighted average shares of common
      stock - Basic                             92.2        96.0          96.0
     Weighted average shares of common
      stock - Diluted                           94.1        96.0          96.0
 
     * Excluding after-tax costs related to the spin-off of $3.3 or $.04 per
       share, and the loss on the disposition of Spanish affiliate of $15.7 or
       $.16 per share, pro forma net loss and loss per share would have been
       $(1.2) and $(.01) for the quarter ended March 31, 2000.
 
 
 
                                                      Pro Forma      Historical
                                                      Basis (a)        Basis
                                          Six Months  Six Months     Six Months
                                            Ended       Ended          Ended
                                          March 31,   March 31,      March 31,
                                             2001       2000           2000
 
     Net Sales                              $910.6    $1,014.7       $1,033.5
 
     Costs and Expenses
       Cost of products sold                 481.6       506.4          514.8
       Selling, general and administrative   192.3       202.5          198.3
       Advertising and promotion              91.6       101.0          101.5
       Research and development               22.6        26.2           26.1
       Costs related to spin-off               -           5.5            5.5
       Loss on disposition of Spanish
        affiliate                              -          15.7           15.7
       Interest expense                       18.7        22.3            5.5
       Other financing items, net              1.6        (5.4)          (3.5)
                                             808.4       874.2          863.9
 
     Earnings from Continuing Operations
      before Income Taxes                    102.2       140.5          169.6
 
     Income Taxes                            (42.4)      (61.2)         (49.2)
 
     Earnings from Continuing Operations      59.8        79.3 **       120.4
 
     Net Gain on Disposition of
      Discontinued Operations                                             1.2
 
     Net Earnings                                                      $121.6
 
     Earnings Per Share From Continuing
      Operations
       Basic                                 $0.64       $0.82 **       $1.24
       Diluted                               $0.63       $0.82 **       $1.24
 
 
     Weighted average shares of common
      stock - Basic                           93.5        96.7           96.7
     Weighted average shares of common
      stock - Diluted                         95.0        96.7           96.7
 
     ** Excluding after-tax costs related to the spin-off of $3.3 or $.04 per
        share, and the loss on the disposition of Spanish affiliate of $15.7 or
        $.16 per share, pro forma net earnings and earnings per share would
        have been $98.3 and $1.02 for the six months ended March 31, 2000.
 
    (a) For comparable purposes with the current quarter and six month results,
        pro forma results for the quarter and six months ended March 31, 2000
        have been adjusted to reflect the impact of the spin-off from Ralston
        Purina Company and the elimination of a one month lag in reporting of
        Energizer's international operations.  See further discussion in
        Note 2.
 
             See Accompanying Notes to Condensed Financial Statements.
 
 
 
                              Energizer Holdings, Inc.
                      Notes to Condensed Financial Statements
                    (Dollars in millions, except per share data)
 
 
 
     1. On April 1, 2000, Ralston Purina Company (Ralston) distributed the
        common stock of its wholly owned subsidiary, Energizer Holdings, Inc.
        (Energizer), to the shareholders of Ralston's common stock through a
        tax-free spin-off.  Following the spin-off, Energizer has conducted its
        business as a separate public company.
 
     2. Prior to fiscal 2001, Energizer's international operations reported
        their results of operations on a one month lag, which allowed more time
        to compile results.  Energizer has taken steps to improve its internal
        reporting procedures that has allowed for more timely reporting of
        these operations.  Beginning in the first quarter of fiscal year 2001,
        the one month lag was eliminated.  The change affected the quarterly
        reporting periods for these operations and thus the pro forma statement
        of earnings has been presented to show comparable results for the
        quarter as if the change would have occurred in the prior year.  The
        September 2000 loss from international operations of $3.3 was recorded
        directly to retained earnings.
 
     3. Operating results for any quarter are not necessarily indicative of the
        results for any other quarter or the full year.
 
     4. Basic earnings per share is based on the weighted-average number of
        shares outstanding during the period.  Diluted earnings per share is
        based on the weighted-average number of shares used in the basic
        earnings per share calculation, adjusted for the dilutive effect of
        stock options and restricted stock equivalents.  Prior year earnings
        per share calculations are based on the weighted-average number of
        Ralston shares outstanding prior to the spin-off, adjusted for the
        distribution of one share of Energizer stock for each three shares of
        Ralston stock.
 
     5. The pro forma statements of earnings reflect the results of operations
        for the quarter and six months ended March 31, 2000 as if the spin-off
        had occurred at the beginning of such periods.  Such statements have
        been prepared by adjusting the historical statements for the effects of
        costs, expenses, assets and liabilities and the recapitalization which
        might have occurred had the spin-off been effected as of the dates
        indicated.  These pro forma financial statements may not necessarily
        reflect the consolidated results of operations that would have existed
        had the spin-off occurred on the dates indicated.
 
        Pro forma adjustments to selling, general and administrative expenses
        include incremental costs of $2.0 and $4.0 for the quarter and six
        months ended March 31, 2000, respectively, associated with becoming a
        stand-alone company, adjustments of $.4 and $.8 for the quarter and six
        months, respectively, to pension income based on the plan assets
        transferred to Energizer in connection with the spin-off and
        adjustments of $(.4) and $(.8) for the quarter and six months,
        respectively, to eliminate certain postretirement benefits costs
        retained by Ralston.
 
        Pro forma adjustments to increase interest expense by $8.2 and $17.1
        for the quarter and six months, respectively, reflects the increased
        debt levels assumed prior to the spin-off.
 
        The pro forma adjustment to increase income tax expense consists of
        adjustments of $26.7 and $23.4 for the quarter and six months,
        respectively,  to reflect income taxes as if Energizer was a single,
        stand-alone tax payer and adjustments of $(6.3) and $(8.4) for the
        quarter and six months, respectively, for the tax effect of the pro
        forma adjustments discussed above.   As discussed in Note 7 below,
        capital loss benefits of $24.4 in the prior year quarter and six months
        are not reflected in the pro forma tax provision.
 
        The pro forma statements of earnings for the quarter and six months
        ended March 31, 2000 have been adjusted to reflect the elimination of
        the one month lag in reporting international results of operations as
        discussed in Note 2 above.
 
     6. The prior year quarter and six month historical and pro forma results
        include one-time spin related costs of $5.5 pre-tax, or $3.3 after-tax.
        These costs include legal fees, charges related to the vesting of
        certain compensation benefits and other costs triggered by or
        associated with the spin-off.
 
     7. The prior year quarter and six month historical and pro forma
        results include a non-cash loss of $15.7 related to the sale of
        Energizer's Spanish affiliate.  Related capital loss benefits of
        $24.4 are included in the historical basis financial statements, but
        have been removed from the pro forma basis statement of earnings
        because such capital loss benefits may not have been realized by
        Energizer on a stand-alone basis.
 
     8. Discontinued operations consist of the Company's worldwide rechargeable
        Original Equipment Manufacturers' battery business, which was sold
        November 1, 1999.  The historical results for the prior year quarter
        and six months include after-tax income of $1.2 related to the final
        settlement of the sale transaction.
 
     9. Segment sales and profitability for the current and prior quarter and
        six month periods ended March 31, 2001 and 2000, respectively, are
        presented below.  The operating profit for the prior year quarter and
        six months ended March 31, 2000, are presented on a pro forma basis
        reflecting the impact of the spin-off from Ralston Purina Company and
        the elimination of the one month lag in reporting international results
        of operations as discussed in Note 2 above.
 
 
     Net External Sales     Quarter Ended March 31,  Six Months Ended March 31,
                              2001          2000         2001          2000
 
        North America        $188.8        $160.5       $517.2        $581.9
        Asia Pacific           78.7          86.5        179.6         203.1
        Europe                 54.3          61.8        140.5         159.6
        South and Central
         America               30.1          26.6         73.3          70.1
           Total
            External
            Sales            $351.9        $335.4        $910.6     $1,014.7
 
 
                             Quarter Ended March 31, Six Months Ended March 31,
                              2001          2000         2001         2000
 
     Operating Profit before
      Unusual Items and
      Amortization
        North America         $37.8         $24.3       $128.7        $170.0
        Asia  Pacific          14.7          18.5         41.8          54.7
        Europe                 (7.0)         (3.4)        (5.9)          5.2
        South and Central
         America                1.0           2.3          6.7           9.3
           Total Segment
            Profitability      46.5          41.7        171.3         239.2
 
        General Corporate
         Expenses             (10.9)        (15.7)       (14.9)        (22.3)
        Research and
         Development
         Expense              (11.1)        (14.1)       (22.6)        (26.2)
            Operating
             Profit
             before
             Unusual
             Items and
             Amortization      24.5          11.9        133.8         190.7
        Costs related to
         spin-off                 -          (5.5)           -          (5.5)
        Loss on
         disposition of
         Spanish affiliate
                                  -         (15.7)           -         (15.7)
        Amortization of
         intangibles           (5.7)         (6.0)       (11.3)        (12.1)
        Interest and Other
         Financial Items       (9.3)         (7.9)       (20.3)        (16.9)
           Earnings from
           Continuing
           Operations
           Before Income
           Taxes               $9.5        $(23.2)      $102.2        $140.5
 
 
 
     Supplemental product information is presented below for revenues from
     external customers.
 
     Net Sales              Quarter Ended March 31,  Six Months Ended March 31,
                             2001          2000          2001         2000
 
     Alkaline Batteries     $218.0        $188.3       $616.2        $675.9
     Carbon Zinc Batteries    61.1          71.8        142.5         172.9
     Lighting Products        25.9          27.7         57.4          71.1
     Miniature Batteries      17.2          14.6         33.7          32.0
     Other                    29.7          33.0         60.8          62.8
        Total Net Sales     $351.9        $335.4       $910.6      $1,014.7
 
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 SOURCE  Energizer Holdings, Inc.