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Energizer Holdings, Inc. Announces
Multi-Year Restructuring Program

Estimated Gross Annualized Pre-Tax Cost Savings of approximately $200 Million

Energizer Holdings, Inc. Press Release - 11/18/2012

ST. LOUIS, Mo. - Energizer Holdings, Inc. (NYSE: ENR) today announced that its Board of Directors authorized an enterprise-wide restructuring plan and has delegated authority to the company's management to determine the final plan with respect to these initiatives.

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Energizer Folding Lantern

Energizer Folding Lantern

Energizer expects to achieve gross annualized pre-tax cost savings of approximately $200 million as a result of this restructuring project. The Company expects that nearly three quarters of the savings will improve profitability, and the remaining portion of the savings will be invested in the business to drive long-term growth. The Company estimates one-time charges associated with achieving these benefits to be approximately 1.25 times gross annualized savings, of which approximately 25% to 30% are estimated to be non-cash charges.

The Company expects that a substantial portion of the actions necessary to achieve the targeted savings should be completed by the end of fiscal 2014 and the total savings are expected to be fully realized in fiscal 2015. A majority of the one-time charges associated with these initiatives are expected to be recorded within the next 12 to 18 months as restructuring costs will likely be incurred ahead of achieving estimated savings (see exhibit - schedule of savings and costs estimates).

These actions are expected to reduce the global workforce by more than 10%, or approximately 1,500 colleagues.

In order to achieve these savings, we are undertaking efforts to:

  • Rationalize and streamline operations facilities in the Household Products Division:
    • Close Maryville, MO battery manufacturing facility
    • Close St. Albans, VT battery manufacturing facility
    • Close Tampoi, Malaysia battery packaging facility
    • Streamline Asheboro, NC battery manufacturing and packaging facilities
    • Streamline Walkerton, Canada packaging facility
    • Streamline lights manufacturing in China
  • Consolidate G&A functional support across the organization;
  • Streamline the Household Products Division product portfolio to enable increased focus on our core battery business;
  • Streamline the marketing organization within our Household Products division;
  • Optimize our go-to-market strategies and organization structures within our international markets;
  • Reduce overhead spending including changes to benefit programs and other targeted spending reductions; and
  • Create a center-led purchasing function to drive procurement savings.

In addition, there are on-going analyses of our international footprint, legal entity structure and global delivery of transactional services to identify and assess additional scale efficiencies. These assessments will be completed in the coming months.

The Company expects these savings will generate increased cash flow and improve key operating metrics, including gross margin and overheads as a percent of sales. In addition, approximately a quarter of the gross savings will be used to increase investment in brand building and innovation to drive future growth, and enable investments in information technology systems to improve capabilities and reduce costs.

"These actions represent significant and necessary changes to our overall cost structure and organization. We have performed a thorough review of our current and future business requirements and have identified the changes that will support our long-term strategies to maximize cash flow in Household Products, enable continued growth in Personal Care and drive shareholder value," said Ward Klein, Chief Executive Officer. "We believe that these changes enhance Energizer's ability to continue to compete effectively in the personal care and household products categories. We have redesigned our short term and long term compensation structures to align the organization to achieve the targeted savings, increase return on invested capital and improve shareholder returns. We are fully committed to achieving targeted savings and will pursue these initiatives with urgency and focus.

"Finally, in support of this effort, we have created the position of Vice President, Global Business Transformation and have named Brian Hamm, our current Vice President of Finance, Household Products, to this role. Brian will report directly to me and will oversee the successful execution of this multi-year program. We will provide regular updates on the progress of these initiatives in future communications."

About Energizer:

Energizer Holdings, Inc., headquartered in St. Louis, Missouri, is a consumer goods company operating globally in the broad categories of personal care and household products. Energizer's Personal Care Division offers a diversified range of consumer products in the wet shave, skin care, feminine care and infant care categories. Our portfolio includes well established brand names such as Schick® and Wilkinson Sword® men's and women's shaving systems and disposables; Edge® and Skintimate® shave preparations; Playtex® tampons, gloves and infant feeding products; Banana Boat® and Hawaiian Tropic® sun care products and Wet Ones® moist wipes. Energizer's Household Products Division offers consumers the broadest range of portable power solutions, anchored by our universally recognized Energizer® and Eveready® brands.

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