Energizer Holdings Inc. Beats Q2 Views; Spin-Off On Track

Energizer Holdings Inc.

swung to a second-quarter net loss on costs for a pending spin-off as well as charges to write off its Venezuela operations, while adjusted profits beat expectations. Shares of the maker of household batteries and personal care products gained about 2 percent recently to $141.91. Net sales for the personal care products segment, expected to be spun off by July 1, fell 5 percent to $651.1 million. The segment's profit dipped 3.3 percent to $165.1 million. The household category, which includes batteries, saw second-quarter sales decline 4.4 percent to $356.9 million as profit grew 9.3 percent to $67.9 million. Results for the recent period included a $144.5 million charge to write off Energizer's investment in Venezuela, and $62.3 million related to a spin-off of Energizer's personal care operations. The company estimated that total spin-off costs through June 30 will be $350 million to $425 million. Energizer's inability to exchange Venezuelan currency for dollars have resulted in a lack of control over operations there for accounting purposes and the business there was de-consolidated from Energizer's results as of March 31. Venezuelan operations are now reported using the cash method of accounting. Energizer Holdings' total adjusted earnings for the recent second quarter equaled $1.97 cents a share, compared with Wall Street's expectation of $1.73 a share. Second-quarter revenue excluding the effects of foreign currency exchange, grew 0.5 percent to $1.01 billion, in line with the consensus view. Energizer posted a net loss of $88.5 million, or $1.41 a share, compared with year-earlier net profit of $98.5 million, or $1.57 a share. The company reiterated that it expects household segment sales will be down by a percentage in the low single digits during the 9 months ending June 30, but increased its outlook for personal care revenue growth to flat, from a previous forecast of a low single-digit decline.