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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported): August 8, 2023
_____________________________________________________________________________________
enrlogoa48.jpg
Energizer Holdings, Inc.
(Exact Name of Registrant as Specified in its Charter)
Missouri
1-36837
36-4802442
(State or other jurisdiction of
incorporation)
(Commission
File Number)
(IRS Employer
Identification Number)
533 Maryville University Drive
St. Louis, Missouri 63141
(Address of principal executive offices)
Registrant’s telephone number, including area code: (314) 985-2000
Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Common Stock, par value $.01 per shareENRNew York Stock Exchange
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
☐    Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐    Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐    Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐    Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).
Emerging growth company ☐
If an emerging growth company, indicate by checkmark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐



Item 2.02. Results of Operations and Financial Condition.

On August 8, 2023, Energizer Holdings, Inc. issued a press release and made available on its website an earnings presentation announcing business results for the third fiscal quarter ended June 30, 2023. A copy of the press release and earnings presentation is attached as Exhibit 99.1 and Exhibit 99.2, respectively, hereto and incorporated herein by reference.

Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
Exhibit No.Description
Press Release, dated August 8, 2023.
Earnings Presentation, dated August 8, 2023.
101Pursuant to Rule 406 of Regulation S-T, the cover page information is formatted in iXBRL (Inline eXtensible Business Reporting Language).
104
Cover Page Interactive Data File (formatted in iXBRL in Exhibit 101).





SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this Current Report on Form 8-K to be signed on its behalf by the undersigned hereunto duly authorized.


ENERGIZER HOLDINGS, INC.


By:  /s/ John J. Drabik            
John J. Drabik
Executive Vice President and Chief Financial Officer

Dated: August 8, 2023






                                    
Exhibit 99.1
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Energizer Holdings, Inc.
533 Maryville University Dr.
St. Louis, MO 63141
FOR IMMEDIATE RELEASECompany Contact
August 8, 2023Jon Poldan
Vice President, Treasurer & Investor Relations
314-985-2349
Jonathan.Poldan@energizer.com

Energizer Holdings, Inc. Announces Fiscal 2023 Third Quarter Results


•Net sales decreased 3.9%, Organic Net sales down 2.7%.1

•Gross margin of 37.9%, and 38.8% on an adjusted basis, as sequential improvement continues through the third quarter, driven largely by the benefits of Project Momentum initiatives. 1

•Operating cash flow of $296.3 million with Free cash flow exceeding 12% of Net Sales year-to-date.1

•Debt pay down of $200 million in the first three quarters.

•Adding a third year to Project Momentum and increasing estimated program savings to $130 to $150 million.

•Reaffirms fiscal year outlook for Adjusted earnings per share and Adjusted EBITDA at the low end of original range.1

St. Louis —August 8, 2023—Energizer Holdings, Inc. (NYSE: ENR) today announced results for the third fiscal quarter ended June 30, 2023.

“While we faced top-line challenges in the third quarter, we have taken aggressive actions throughout the year to preserve the earnings power of our business,” said Mark LaVigne, Chief Executive Officer. “We are accelerating our plans under Project Momentum and now expect program savings to be in the range of $130 to $150 million, an increase of $50 million from our original estimate. Despite lower net sales, we still expect to deliver full fiscal year 2023 adjusted earnings per share and adjusted EBITDA at the low end of our original range."

“Though the year has not progressed as expected, the actions we are taking to position the business for long term success are leading to steadily improving margins and cash flow, enabling us to reduce debt and reinvest back into our business to deliver sustainable growth and long-term shareholder value.”

Top-Line Performance

For the quarter, we had Net sales of $699.4 million compared to $728.0 million in the prior year period.
Third Quarter% Chg
Net sales - FY'22$728.0 
Organic(19.3)(2.7)%
Change in Argentina Operations(5.1)(0.7)%
Impact of currency(4.2)(0.5)%
Net sales - FY'23$699.4 (3.9)%

__________________
1) See Press Release attachments and supplemental schedules for additional information, including the GAAP and Non-GAAP reconciliations.



•Organic Net sales decreased 2.7% primarily due to the following items:

•Volume declines across battery impacted organic revenue by approximately 4.5% due to weaker performance at a number of non-tracked retail customers during the quarter and general economic headwinds impacting category performance;

•Volume declines from our auto care business of approximately 3.0%, largely due to cooler weather in the quarter negatively impacting refrigerant sales, and

•Volume declines of approximately 1.5% from the planned exit of low margin business and a decline in our sales to device manufacturers due to their delay of new product launches.

•Partially offsetting the declines was the continued benefit of global pricing actions in both the battery and auto care businesses contributing approximately 6.5% to organic sales.

Gross Margin

Gross margin percentage on a reported basis was 37.9% versus 39.0% in the prior year. Excluding the current year restructuring costs and prior year costs related to the flooding of our Brazil plant, adjusted gross margin was 38.8%, compared to the prior year adjusted gross margin of 40.4%.(1)
Third Quarter
Gross margin - FY'22 Reported
39.0 %
Prior year impact of the Brazil flood1.4 %
Gross margin - FY'22 Adjusted(1)
40.4 %
Pricing3.7 %
Project Momentum continuous improvement initiatives1.2 %
Mix impact0.1 %
Product cost impacts(6.5)%
Currency impact and other(0.1)%
Gross margin - FY'23 Adjusted(1)
38.8 %
Current year impact of restructuring costs(0.9)%
Gross margin - FY'23 Reported37.9 %

The Gross margin decline was largely driven by higher operating costs, including raw materials, the timing of inventory builds in the prior year, ongoing inflationary trends and adverse currency impacts. The decline was partially offset by the continued benefit of pricing initiatives, Project Momentum savings of $10.7 million and the benefit of exiting lower margin battery business.

Selling, General and Administrative Expense (SG&A)

SG&A, excluding restructuring costs, for the third quarter was 16.2% of Net sales, or $113.3 million, compared to 16.3%, or $118.9 in the prior year. The year-over-year decrease was primarily driven by Project Momentum savings, favorable currency impacts and lower environmental expense. These declines were partially offset by higher compensation expense and factoring fees in the current year.(1)

Advertising and Promotion Expense (A&P)

A&P expense decreased $0.9 million and was 5.4% of net sales for the third fiscal quarter, compared to 5.3% in the prior year.

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Earnings Per Share and Adjusted EBITDAThird Quarter
(In millions, except per share data)20232022
Net earnings$31.8 $52.4 
Diluted net earnings per common share$0.44 $0.73 
Adjusted net earnings(1)
$38.9 $55.5 
Adjusted diluted net earnings per common share(1)
$0.54 $0.77 
Adjusted EBITDA(1)
$126.8 $145.5 
Currency neutral Adjusted diluted net earnings per common share(1)
$0.58 
Currency neutral Adjusted EBITDA(1)
$130.2 

The decline in Net earnings, Earnings per share and Adjusted EBITDA for the quarter reflects the decrease in organic net sales, the decline in gross margin, higher interest expense and adverse currency movements. These declines were partially offset by savings from Project Momentum initiatives and decreased A&P and SG&A spending.

Capital Allocation

•Dividend payments in the quarter were approximately $22 million, or $0.30 per common share.

•Operating cash flow for the first three quarters was $296.3 million, and free cash flow was $261.6 million, or 12.2% of Net sales.

•Long-term debt pay down in the first three quarters was $200.0 million. Net debt to Adjusted EBITDA was 5.7 times as of June 30, 2023.

Financial Outlook and Assumptions for Fiscal Year 2023(1)

We are lowering our outlook for full year organic revenue from up low single digits to down low single digits. Even with lower revenues, we expect continued gross margin recovery, driven largely by Project Momentum savings, to support delivery of Adjusted EPS and Adjusted EBITDA at the low end of our previously communicated ranges.

We anticipate fourth fiscal quarter organic revenue will be roughly flat with significant year over year gross margin improvement due to declining input costs and the continued benefit of Project Momentum savings. For the fourth fiscal quarter, we anticipate Adjusted EPS to be in the range of $1.10 to $1.20 and Adjusted EBITDA in the range of $173 and $183 million.

Project Momentum remains on track with approximately $32 million of savings delivered year-to-date and total project savings of $45 to $50 million anticipated for the full year. We have added a third year to the program that will increase our savings to $130 to $150 million by the end of 2025. Total one-time program cash costs are now projected to be roughly 75% of expected savings. With the expansion of the program, total one-time cash project costs for the current year are now expected to be in the range of $45 to $50 million.

Webcast Information
In conjunction with this announcement, the Company will hold an investor conference call beginning at 10:00 a.m. Eastern Time today. The call will focus on third fiscal quarter earnings and recent trends in the business. All interested parties may access a live webcast of this conference call at www.energizerholdings.com, under "Investors" and "Events and Presentations" tabs or by using the following link:
https://app.webinar.net/Yy8Abz7MOpG

For those unable to participate during the live webcast, a replay will be available on www.energizerholdings.com, under "Investors," "Events and Presentations," and "Past Events" tabs.
# # #
This document contains both historical and forward-looking statements. Forward-looking statements are not based on historical facts but instead reflect our expectations, estimates or projections concerning future results or events, including, without limitation, the future sales, gross margins, costs, earnings, cash flows, tax rates and performance of the Company. These statements generally can be identified by the use of forward-looking words or phrases such as "believe," "expect," "expectation," "anticipate," "may,"
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"could," "will," "intend," "belief," "estimate," "plan," "target," "predict," "likely," "should," "forecast," "outlook," or other similar words or phrases. These statements are not guarantees of performance and are inherently subject to known and unknown risks, uncertainties and assumptions that are difficult to predict and could cause our actual results to differ materially from those indicated by those statements. We cannot assure you that any of our expectations, estimates or projections will be achieved. The forward-looking statements included in this document are only made as of the date of this document and we disclaim any obligation to publicly update any forward-looking statement to reflect subsequent events or circumstances. All forward-looking statements should be evaluated with the understanding of their inherent uncertainty. Numerous factors could cause our actual results and events to differ materially from those expressed or implied by forward-looking statements, including, without limitation:
•Global economic and financial market conditions, including the conditions resulting from the COVID-19 pandemic, and actions taken by our customers, suppliers, other business partners and governments in markets in which we compete might materially and negatively impact us.
•Competition in our product categories might hinder our ability to execute our business strategy, achieve profitability, or maintain relationships with existing customers.
•Changes in the retail environment and consumer preferences could adversely affect our business, financial condition and results of operations.
•We must successfully manage the demand, supply, and operational challenges brought about by the COVID-19 pandemic and any other disease outbreak, including epidemics, pandemics, or similar widespread public health concerns.
•Loss or impairment of the reputation of our Company or our leading brands or failure of our marketing plans could have an adverse effect on our business.
•Loss of any of our principal customers could significantly decrease our sales and profitability.
•Our ability to meet our growth targets depends on successful product, marketing and operations innovation and successful responses to competitive innovation and changing consumer habits.
•We are subject to risks related to our international operations, including currency fluctuations, which could adversely affect our results of operations.
•If we fail to protect our intellectual property rights, competitors may manufacture and market similar products, which could adversely affect our market share and results of operations.
•Changes in production costs, including raw material prices and transportation costs, from inflation or otherwise, have adversely affected, and in the future could erode, our profit margins and negatively impact operating results.
•Our reliance on certain significant suppliers subjects us to numerous risks, including possible interruptions in supply, which could adversely affect our business.
•Our business is vulnerable to the availability of raw materials, our ability to forecast customer demand and our ability to manage production capacity.
•The manufacturing facilities, supply channels or other business operations of the Company and our suppliers may be subject to disruption from events beyond our control.
•The Company's future results may be affected by its operational execution, including scenarios where the Company generates fewer productivity improvements than estimated.
•If our goodwill and indefinite-lived intangible assets become impaired, we will be required to record impairment charges, which may be significant.
•A failure of a key information technology system could adversely impact our ability to conduct business.
•We rely significantly on information technology and any inadequacy, interruption, theft or loss of data, malicious attack, integration failure, failure to maintain the security, confidentiality or privacy of sensitive data residing on our systems or other security failure of that technology could harm our ability to effectively operate our business and damage the reputation of our brands.
•We have significant debt obligations that could adversely affect our business and our ability to meet our obligations.
•If we pursue strategic acquisitions, divestitures or joint ventures, we might experience operating difficulties, dilution, and other consequences that may harm our business, financial condition, and operating results, and we may not be able to successfully consummate favorable transactions or successfully integrate acquired businesses.
•Our business involves the potential for product liability claims, labeling claims, commercial claims and other legal claims against us, which could affect our results of operations and financial condition and result in product recalls or withdrawals.
•Our business is subject to increasing government regulations in both the U.S. and abroad that could impose material costs.
•Increased focus by governmental and non-governmental organizations, customers, consumers and shareholders on environmental, social and governance (ESG) issues, including those related to sustainability and climate change, may have an adverse effect on our business, financial condition and results of operations and damage our reputation.
•We are subject to environmental laws and regulations that may expose us to significant liabilities and have a material adverse effect on our results of operations and financial condition.
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In addition, other risks and uncertainties not presently known to us or that we consider immaterial could affect the accuracy of any such forward-looking statements. The list of factors above is illustrative, but by no means exhaustive. All forward-looking statements should be evaluated with the understanding of their inherent uncertainty. Additional risks and uncertainties include those detailed from time to time in our publicly filed documents, including those described under the heading “Risk Factors” in our Form 10-K filed with the Securities and Exchange Commission on November 15, 2022.
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ENERGIZER HOLDINGS, INC.
CONSOLIDATED STATEMENT OF EARNINGS
(Condensed)
(In millions, except per share data - Unaudited)

For the Quarter Ended June 30,For the Nine Months Ended June 30,
 2023202220232022
Net sales$699.4 $728.0 $2,148.6 $2,259.7 
Cost of products sold (1)434.3 444.0 1,331.9 1,425.7 
Gross profit265.1 284.0 816.7 834.0 
Selling, general and administrative expense (1)116.1 118.9 354.8 364.4 
Advertising and sales promotion expense37.6 38.5 109.4 109.8 
Research and development expense (1)8.8 8.5 24.4 25.3 
Amortization of intangible assets14.5 15.4 45.0 45.8 
Interest expense42.2 41.1 127.1 116.4 
Loss/(gain) on extinguishment of debt (2)0.3 — (1.7)— 
Other items, net (1)5.2 (3.5)4.6 2.7 
Earnings before income taxes40.4 65.1 153.1 169.6 
Income tax provision8.6 12.7 32.3 38.2 
Net earnings31.8 52.4 120.8 131.4 
Mandatory preferred stock dividends (3)— — — (4.0)
Net earnings attributable to common shareholders$31.8 $52.4 $120.8 $127.4 
Basic net earnings per common share$0.44 $0.73 $1.69 $1.83 
Diluted net earnings per common share (3)$0.44 $0.73 $1.67 $1.82 
Weighted average shares of common stock - Basic71.5 71.3 71.4 69.5 
Weighted average shares of common stock - Diluted (3)72.5 71.7 72.4 69.9 

(1) See the attached Supplemental Schedules - Non-GAAP Reconciliations, which break out the Project Momentum restructuring and related costs, the costs from the flood of our Brazilian manufacturing facility, the gain on finance lease termination, the costs from exiting the Russian market, and Acquisition and integration related costs included within these lines.

(2) The Loss on the extinguishment of debt for the quarter ended June 30, 2023 relates to the repayment of term loan in the quarter. The Gain on extinguishment of debt in the nine months ended June 30, 2023 relates to the repurchase of outstanding Senior Notes at a discount, partially offset by the repayment of term loan.

(3) During January 2022, the mandatory convertible preferred shares (MCPS) were converted to approximately 4.7 million common stock. For the nine months ended June 30, 2022, the conversion of the mandatory convertible preferred shares was anti-dilutive and the mandatory preferred stock dividends are included in the dilution calculation. The Company no longer has any MCPS outstanding in fiscal 2023.

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ENERGIZER HOLDINGS, INC.
CONSOLIDATED BALANCE SHEETS
(Condensed)
(In millions - Unaudited)

AssetsJune 30,
2023		September 30,
2022
Current assets 
Cash and cash equivalents$202.4 $205.3 
     Trade receivables385.1 421.7 
Inventories765.4 771.6 
Other current assets215.5 191.4 
Total current assets$1,568.4 $1,590.0 
Property, plant and equipment, net351.8 362.1 
Operating lease assets96.9 100.1 
Goodwill1,023.2 1,003.1 
Other intangible assets, net1,253.0 1,295.8 
Deferred tax asset66.4 61.8 
Other assets145.4 159.2 
Total assets$4,505.1 $4,572.1 
Liabilities and Shareholders' Equity
Current liabilities
Current maturities of long-term debt$12.0 $12.0 
Current portion of finance leases0.3 0.4 
Notes payable5.3 6.4 
Accounts payable381.1 329.4 
Current operating lease liabilities16.3 15.8 
Other current liabilities311.1 333.9 
Total current liabilities$726.1 $697.9 
Long-term debt3,377.0 3,499.4 
Operating lease liabilities84.2 88.2 
Deferred tax liability16.1 17.9 
Other liabilities134.8 138.1 
Total liabilities$4,338.2 $4,441.5 
Shareholders' equity
Common stock0.8 0.8 
Additional paid-in capital768.4 828.7 
Retained losses(184.3)(304.7)
Treasury stock(238.8)(248.9)
Accumulated other comprehensive loss(179.2)(145.3)
Total shareholders' equity$166.9 $130.6 
Total liabilities and shareholders' equity$4,505.1 $4,572.1 
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ENERGIZER HOLDINGS, INC.
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Condensed)
(In millions - Unaudited)

 For the Nine Months Ended June 30,
 20232022
Cash Flow from Operating Activities  
Net earnings$120.8 $131.4 
Non-cash integration and restructuring charges2.3 3.0 
Depreciation and amortization93.0 89.0 
Deferred income taxes(4.6)(0.7)
Share-based compensation expense17.2 9.9 
Gain on finance lease termination— (4.5)
Gain on extinguishment of debt(1.7)— 
Non-cash charges of the Brazilian flood— 9.2 
Non-cash charges for exiting the Russian market— 13.4 
Non-cash items included in income, net22.3 12.4 
Other, net2.9 0.9 
Changes in current assets and liabilities used in operations44.1 (370.2)
Net cash from/(used by) operating activities296.3 (106.2)
Cash Flow from Investing Activities
Capital expenditures(35.4)(65.8)
Proceeds from sale of assets0.7 0.5 
Acquisition of intangible assets— (14.6)
Acquisitions, net of cash acquired and working capital settlements— 1.0 
Net cash used by investing activities(34.7)(78.9)
Cash Flow from Financing Activities  
Cash proceeds from issuance of debt with original maturities greater than 90 days— 300.0 
Payments on debt with maturities greater than 90 days(197.0)(10.6)
Net increase/(decrease) in debt with original maturities of 90 days or less2.5 (43.8)
Payments to terminate finance lease obligations— (5.1)
Debt issuance costs— (7.6)
Dividends paid on common stock(64.8)(64.1)
Dividends paid on mandatory convertible preferred stock— (8.1)
Taxes paid for withheld share-based payments(1.9)(2.3)
Net cash (used by)/from financing activities(261.2)158.4 
Effect of exchange rate changes on cash(3.3)(12.7)
Net decrease in cash, cash equivalents, and restricted cash(2.9)(39.4)
Cash, cash equivalents, and restricted cash, beginning of period205.3 238.9 
Cash, cash equivalents, and restricted cash, end of period$202.4 $199.5 
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ENERGIZER HOLDINGS, INC.
Reconciliation of GAAP and Non-GAAP Measures
For the Quarter and Nine Months Ended June 30, 2023
The Company reports its financial results in accordance with accounting principles generally accepted in the U.S. ("GAAP"). However, management believes that certain non-GAAP financial measures provide users with additional meaningful comparisons to the corresponding historical or future period, and are used for management incentive compensation. These non-GAAP financial measures exclude items that are not reflective of the Company's on-going operating performance, such as restructuring and related costs, acquisition and integration costs, an acquisition earn out, the loss/(gain) on extinguishment of debt, the costs of the May 2022 flooding of our Brazilian manufacturing facility, the gain on finance lease termination, and the costs of exiting the Russian market. In addition, these measures help investors to analyze year over year comparability when excluding currency fluctuations as well as other Company initiatives that are not on-going. We believe these non-GAAP financial measures are an enhancement to assist investors in understanding our business and in performing analysis consistent with financial models developed by research analysts. Investors should consider non-GAAP measures in addition to, not as a substitute for, or superior to, the comparable GAAP measures. In addition, these non-GAAP measures may not be the same as similar measures used by other companies due to possible differences in methods and in the items being adjusted.

We provide the following non-GAAP measures and calculations, as well as the corresponding reconciliation to the closest GAAP measure in the following supplemental schedules:

Segment Profit. This amount represents the operations of our two reportable segments including allocations for shared support functions. General corporate and other expenses, amortization expense, interest expense, loss/(gain) on extinguishment of debt, other items, net, the charges related to acquisition and integration costs, restructuring and related costs, an acquisition earn out, the costs of the flooding of our Brazilian manufacturing facility, the gain on finance lease termination, and the costs of exiting the Russian market have all been excluded from segment profit.

Adjusted Net Earnings and Adjusted Diluted Net Earnings Per Common Share (EPS). These measures exclude the impact of the costs related to acquisition and integration, restructuring and related costs, an acquisition earn out, the loss/(gain) on extinguishment of debt, the costs of the flooding of our Brazilian manufacturing facility, the gain on finance lease termination and the costs of exiting the Russian market.

Non-GAAP Tax Rate. This is the tax rate when excluding the pre-tax impact of acquisition and integration costs, restructuring and related costs, an acquisition earn out, the loss/(gain) on extinguishment of debt, the costs of the flooding of our Brazilian manufacturing facility, the gain on finance lease termination, and the costs of exiting the Russian market, as well as the related tax impact for these items, calculated utilizing the statutory rate for where the impact was incurred.

Organic. This is the non-GAAP financial measurement of the change in revenue or segment profit that excludes or otherwise adjusts for the change in Russia and Argentina operations and impact of currency from the changes in foreign currency exchange rates as defined below:

Change in Russia Operations. The Company exited the Russian market in the second quarter of fiscal 2022 due to the increased global and economic and political uncertainty resulting from the ongoing conflict between Russia and Ukraine. This adjusts for the change in Russian sales and segment profit from the prior year post exit.

Change in Argentina Operations. The Company is presenting separately all changes in sales and segment profit from our Argentina affiliate due to the designation of the economy as highly inflationary as of July 1, 2018.

Impact of Currency. The Company evaluates the operating performance of our Company on a currency neutral basis. The Impact of Currency is the change in foreign currency exchange rates year-over-year on reported results, which is calculated by comparing the value of current year foreign operations at the current period USD exchange rate versus the value of current year foreign operations at the prior period USD exchange rate. The impact of currency also includes gains/(losses) of currency hedging programs, and it excludes hyper-inflationary markets.
Adjusted Comparisons. Detail for adjusted gross profit, adjusted gross margin, adjusted SG&A and adjusted SG&A as percent of sales and adjusted Other items, net are also supplemental non-GAAP measure disclosures. These measures exclude the impact of costs related to acquisition and integration, restructuring and related costs, an acquisition earn out, the costs of the flooding of our Brazilian manufacturing facility, the gain on finance lease termination, and the costs of exiting the Russian market.

EBITDA and Adjusted EBITDA. EBITDA is defined as net earnings before income tax provision, interest, the loss/(gain) on extinguishment of debt, and depreciation and amortization. Adjusted EBITDA further excludes the impact of the costs related to restructuring, exiting the Russian market, gains on finance lease termination, the costs of the flooding of our manufacturing facility in Brazil, impairment of goodwill and other intangible assets, and share based payments.

Free Cash Flow. Free Cash Flow is defined as net cash provided by operating activities reduced by capital expenditures, net of the proceeds from asset sales.

Net Debt. Net Debt is defined as total Company debt, less cash and cash equivalents.

Currency-neutral. Currency-neutral excludes the Impact of Currency as defined above on key measures. Hyper inflationary markets are excluded from this calculation.
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Energizer Holdings, Inc.
Supplemental Schedules - Currency Neutral Results
For the Quarter and Nine Months Ended June 30, 2023
(In millions, except per share data - Unaudited)



For the Quarter EndedPrior Quarter Ended
June 30, 2023% Change% Change
As Reported
Impact of Currency(1)
Currency NeutralJune 30, 2022As Reported BasisCurrency Neutral Basis
As Reported under GAAP
Diluted net earnings per common share$0.44 $(0.04)$0.48 $0.73 (39.7)%(34.2)%
Net Earnings$31.8 $(2.5)$34.3 $52.4 (39.3)%(34.5)%
As Adjusted (non-GAAP)(2)
Adjusted diluted net earnings per common share$0.54 $(0.04)$0.58 $0.77 (29.9)%(24.7)%
Adjusted EBITDA$126.8 $(3.4)$130.2 $145.5 (12.9)%(10.5)%

For the Nine Months EndedPrior Nine Months Ended
June 30, 2023% Change% Change
As Reported
Impact of Currency(1)
Currency NeutralJune 30, 2022As Reported BasisCurrency Neutral Basis
As Reported under GAAP
Diluted net earnings per common share$1.67 $(0.26)$1.93 $1.82 (8.2)%6.0 %
Net Earnings$120.8 $(18.7)$139.5 $131.4 (8.1)%6.2 %
As Adjusted (non-GAAP)(2)
Adjusted diluted net earnings per common share$1.90 $(0.26)$2.16 $2.26 (15.9)%(4.4)%
Adjusted EBITDA$411.9 $(23.8)$435.7 $421.9 (2.4)%3.3 %

(1) The Impact of Currency is the change in foreign currency exchange rates year-over-year on reported results, which is calculated by comparing the value of current year foreign operations at the current period USD exchange rate versus the value of current year foreign operations at the prior period USD exchange rate. The impact of currency also includes gains/(losses) of currency hedging programs, and it excludes hyper-inflationary markets.

(2) See supplemental schedules - Non-GAAP Reconciliations for full reconciliations of the Company's non-GAAP adjusted amounts.



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Energizer Holdings, Inc.
Supplemental Schedules - Segment Information
For the Quarter and Nine Months Ended June 30, 2023
(In millions - Unaudited)

Operations for Energizer are managed via two product segments: Batteries & Lights and Auto Care. Energizer’s operating model includes a combination of standalone and shared business functions between the product segments, varying by country and region of the world. Shared functions include the sales and marketing functions, as well as human resources, IT and finance shared service costs. Energizer applies a fully allocated cost basis, in which shared business functions are allocated between segments. Such allocations are estimates, and may not represent the costs of such services if performed on a standalone basis. Segment sales and profitability, as well as the reconciliation to earnings before income taxes for the quarters and nine months ended June 30, 2023 and 2022 are presented below:
 Quarters Ended June 30,Nine Months Ended June 30,
 2023202220232022
Net Sales  
Batteries & Lights
$511.3 $531.6 $1,688.8 $1,788.3 
Auto Care188.1 196.4 459.8 471.4 
Total net sales$699.4 $728.0 $2,148.6 $2,259.7 
Segment Profit 
Batteries & Lights
121.9 142.7 374.7 406.4 
Auto Care17.4 12.9 57.4 37.0 
Total segment profit$139.3 $155.6 $432.1 $443.4 
    General corporate and other expenses (1)(27.4)(27.6)(80.6)(74.9)
    Amortization of intangible assets(14.5)(15.4)(45.0)(45.8)
    Restructuring and related costs (2)(9.1)— (23.2)— 
    Acquisition and integration costs (2) — — — (16.5)
    Acquisition earn out (3)— — — (1.1)
    Interest expense(42.2)(41.1)(127.1)(116.4)
    (Loss)/gain on extinguishment of debt(0.3)— 1.7 — 
Gain on finance lease termination (4)— 4.5 — 4.5 
Exit of Russian market (5)— — — (14.0)
Brazil flood damage (6)— (9.9)— (9.9)
    Other items, net - Adjusted (7)(5.4)(1.0)(4.8)0.3 
Total earnings before income taxes$40.4 $65.1 $153.1 $169.6 
(1) Recorded in SG&A on the Consolidated (Condensed) Statement of Earnings.
(2) See the Supplemental Schedules - Non-GAAP Reconciliations for the line items where these charges are recorded in the Consolidated (Condensed) Statement of Earnings.
(3) This represents the earn out achieved through June 30, 2022 under the incentive agreements entered into with the fiscal 2021 acquisition of a formulations company, and is recorded in SG&A on the Consolidated (Condensed) Statement of Earnings.
(4) This represents the termination of a finance lease in the quarter ended June 30, 2022 associated with a facility that was exited as a part of the Company's 2019 Restructuring program. The gain was recorded in Other items, net in the Consolidated (Condensed) Statement of Earnings.
(5) These are the costs associated with the exit of the Russian market during the second quarter of fiscal 2022. See the Supplemental Non-GAAP reconciliation for the line items where these charges are recorded in the Consolidated (Condensed) Statement of Earnings.
(6) These are the costs associated with the May 2022 flooding of our Brazilian manufacturing facility, which were recorded in Cost of products sold on the Consolidated (Condensed) Statement of Earnings. The majority is related to write off of damaged inventory.
(7) See the Supplemental Non-GAAP reconciliation for the Other items, net reconciliation between the reported and adjusted balances.
Supplemental segment information is presented below for depreciation and amortization:
Quarters Ended June 30,Nine Months Ended June 30,
Depreciation and amortization2023202220232022
Batteries & Lights$13.0 $12.5 $39.5 $36.4 
Auto Care3.0 2.5 8.5 6.8 
Total segment depreciation and amortization$16.0 $15.0 $48.0 $43.2 
Amortization of intangible assets14.5 15.4 45.0 45.8 
Total depreciation and amortization$30.5 $30.4 $93.0 $89.0 
11
Energizer Holdings, Inc.
Supplemental Schedules - GAAP EPS to Adjusted EPS Reconciliation
For the Quarter Ended June 30, 2023
(In millions, except for per share data- Unaudited)



For the Quarters Ended June 30,For the Nine Months Ended June 30,
2023202220232022
Net earnings attributable to common shareholders$31.8 $52.4 $120.8 $127.4 
Mandatory preferred stock dividends— — — (4.0)
Net earnings31.8 52.4 120.8 131.4 
Pre-tax adjustments
Restructuring and related costs (1)9.1 — 23.2 — 
Acquisition and integration (1)— — — 16.5 
Acquisition earn out (1)— — — 1.1 
Loss/(gain) on extinguishment of debt0.3 — (1.7)— 
Exit of Russian market (1)— — — 14.0 
Gain on finance lease termination (1)— (4.5)— (4.5)
Brazil flood damage (1)— 9.9 — 9.9 
Total adjustments, pre-tax$9.4 $5.4 $21.5 $37.0 
Total adjustments, after tax$7.1 $3.1 $16.4 $31.2 
Adjusted net earnings (2)$38.9 $55.5 $137.2 $162.6 
Mandatory preferred stock dividends— — — (4.0)
Adjusted net earnings attributable to common shareholders$38.9 $55.5 $137.2 $158.6 
Diluted net earnings per common share $0.44 $0.73 $1.67 $1.82 
Adjustments
Restructuring and related costs0.10 — 0.25 — 
Acquisition and integration— — — 0.18 
Acquisition earn out— — — 0.01 
Loss/(gain) on extinguishment of debt— — (0.02)— 
Exit of Russian market — — — 0.20 
Brazil flood damage, net of insurance proceeds— 0.09 — 0.09 
Gain on finance lease termination— (0.05)— (0.05)
Impact for diluted share calculation (3)— — — 0.01 
Adjusted diluted net earnings per diluted common share (3)$0.54 $0.77 $1.90 $2.26 
Weighted average shares of common stock - Diluted72.5 71.7 72.4 69.9 
Adjusted Weighted average shares of common stock - Diluted (3)72.5 71.7 72.4 71.8

(1) See Supplemental Schedules - Non-GAAP Reconciliations for the line items where these costs are recorded on the unaudited Consolidated (Condensed) Statement of Earnings.

(2) The effective tax rate for the Adjusted - Non-GAAP Earnings and Diluted EPS for the quarters ended June 30, 2023 and 2022 was 21.9% and 21.3%, respectively, and for the nine months ended June 30, 2023 and 2022 was 21.4% and 21.3%, respectively, as calculated utilizing the statutory rate for where the costs were incurred.

(3) During the nine months ended June 30, 2022, the mandatory convertible preferred shares were converted to approximately 4.7 million common stock. The full conversion was dilutive and the mandatory preferred stock dividends are excluded from net earnings in the Adjusted dilution calculation.
12

Energizer Holdings, Inc.
Supplemental Schedules - Segment Sales
For the Quarter and Nine Months Ended June 30, 2023
(In millions - Unaudited)
Net salesQ1'23% ChgQ2'23% ChgQ3'23% ChgNine Months '23% Chg
Batteries & Lights
Net sales - prior year$740.2 $516.5 $531.6 $1,788.3 
Organic(34.8)(4.7)%7.3 1.4 %(11.0)(2.1)%(38.5)(2.2)%
Change in Argentina Operations1.3 0.2 %0.5 0.1 %(5.1)(1.0)%(3.3)(0.2)%
Change in Russia Operations(7.3)(1.0)%(5.0)(1.0)%— — %(12.3)(0.7)%
Impact of currency(27.8)(3.8)%(13.4)(2.6)%(4.2)(0.7)%(45.4)(2.5)%
Net sales - current year$671.6 (9.3)%$505.9 (2.1)%$511.3 (3.8)%$1,688.8 (5.6)%
Auto Care
Net sales - prior year$106.1 $168.9 $196.4 $471.4 
Organic(10.8)(10.2)%10.2 6.0 %(8.3)(4.2)%(8.9)(1.9)%
Change in Argentina Operations— — %0.2 0.1 %— — %0.2 — %
Change in Russia Operations(0.2)(0.2)%(0.1)(0.1)%— — %(0.3)(0.1)%
Impact of currency(1.6)(1.5)%(1.0)(0.5)%— — %(2.6)(0.5)%
Net sales - current year$93.5 (11.9)%$178.2 5.5 %$188.1 (4.2)%$459.8 (2.5)%
Total Net Sales
Net sales - prior year$846.3 $685.4 $728.0 $2,259.7 
Organic(45.6)(5.4)%17.5 2.6 %(19.3)(2.7)%(47.4)(2.1)%
Change in Argentina Operations1.3 0.2 %0.7 0.1 %(5.1)(0.7)%(3.1)(0.1)%
Change in Russia Operations(7.5)(0.9)%(5.1)(0.7)%— — %(12.6)(0.6)%
Impact of currency(29.4)(3.5)%(14.4)(2.2)%(4.2)(0.5)%(48.0)(2.1)%
Net sales - current year$765.1 (9.6)%$684.1 (0.2)%$699.4 (3.9)%$2,148.6 (4.9)%
13

Energizer Holdings, Inc.
Supplemental Schedules - Segment Profit
For the Quarter and Nine Months Ended June 30, 2023
(In millions - Unaudited)
Segment profitQ1'23% ChgQ2'23% ChgQ3'23% ChgNine Months '23% Chg
Batteries & Lights
Segment profit - prior year$168.4 $95.3 $142.7 $406.4 
Organic(15.6)(9.3)%27.5 28.9 %(16.7)(11.7)%(4.8)(1.2)%
Change in Argentina Operations— — %0.7 0.7 %(1.7)(1.2)%(1.0)(0.2)%
Change in Russia Operations(0.6)(0.4)%(0.6)(0.6)%— — %(1.2)(0.3)%
Impact of currency(13.9)(8.2)%(8.4)(8.9)%(2.4)(1.7)%(24.7)(6.1)%
Segment profit - current year$138.3 (17.9)%$114.5 20.1 %$121.9 (14.6)%$374.7 (7.8)%
Auto Care
Segment (loss)/profit - prior year$(0.2)$24.3 $12.9 $37.0 
Organic12.3 NM *5.6 23.0 %4.5 34.9 %22.4 60.5 %
Change in Argentina Operations(0.1)NM *0.1 0.4 %— — %— — %
Impact of currency(1.4)NM *(0.6)(2.4)%— — %(2.0)(5.4)%
Segment profit - current year$10.6 NM *$29.4 21.0 %$17.4 34.9 %$57.4 55.1 %
Total Segment Profit
Segment profit - prior year$168.2 $119.6 $155.6 $443.4 
Organic(3.3)(2.0)%33.1 27.7 %(12.2)(7.8)%17.6 4.0 %
Change in Argentina Operations(0.1)(0.1)%0.8 0.7 %(1.7)(1.1)%(1.0)(0.2)%
Change in Russia Operations(0.6)(0.4)%(0.6)(0.5)%— — %(1.2)(0.3)%
Impact of currency(15.3)(9.0)%(9.0)(7.6)%(2.4)(1.6)%(26.7)(6.0)%
Segment profit - current year$148.9 (11.5)%$143.9 20.3 %$139.3 (10.5)%$432.1 (2.5)%

NM * - These percentage calculations are not meaningful.
14
Energizer Holdings, Inc.
Supplemental Schedules - Non-GAAP Reconciliations
For the Quarter and Nine Months Ended June 30, 2023
(In millions - Unaudited)

Gross profitQ1'23Q2'23Q3'23Q1'22Q2'22Q3'22Q3'23 YTDQ3'22 YTD
Net sales$765.1 $684.1 $699.4 $846.3 $685.4 $728.0 $2,148.6 $2,259.7 
Reported Cost of products sold466.8 430.8434.3 534.7 447.0444.0 1,331.9 1,425.7 
Gross profit$298.3 $253.3 $265.1 $311.6 $238.4 $284.0 $816.7 $834.0 
Gross margin39.0 %37.0 %37.9 %36.8 %34.8 %39.0 %38.0 %36.9 %
Adjustments
Restructuring and related costs0.3 5.7 6.5 — — — 12.5 — 
Acquisition and integration costs— — — 6.0 — — — 6.0 
Exit of Russian market— — — — 0.7 — — 0.7 
Brazil flood damage— — — — — 9.9 — 9.9 
Cost of products sold - adjusted466.5 425.1 427.8 528.7 446.3 434.1 1,319.4 1,409.1 
Adjusted Gross profit$298.6 $259.0 $271.6 $317.6 $239.1 $293.9 $829.2 $850.6 
Adjusted Gross margin39.0 %37.9 %38.8 %37.5 %34.9 %40.4 %38.6 %37.6 %
SG&AQ1'23Q2'23Q3'23Q1'22Q2'22Q3'22Q3'23 YTDQ3'22 YTD
Reported SG&A$120.4 $118.3 $116.1 $122.1 $123.4 $118.9 $354.8 $364.4 
Reported SG&A % of Net sales15.7 %17.3 %16.6 %14.4 %18.0 %16.3 %16.5 %16.1 %
Adjustments
Restructuring and related costs6.3 1.8 2.8 — — — 10.9 — 
Acquisition and integration costs— — — 9.4 — — — 9.4 
Exit of Russian Market— — — — 5.8 — — 5.8 
Acquisition earn out— — — 1.1 — — — 1.1 
SG&A Adjusted - subtotal$114.1 $116.5 $113.3 $111.6 $117.6 $118.9 $343.9 $348.1 
SG&A Adjusted % of Net sales14.9 %17.0 %16.2 %13.2 %17.2 %16.3 %16.0 %15.4 %
Other items, netQ1'23Q2'23Q3'23Q1'22Q2'22Q3'22Q3'23 YTDQ3'22 YTD
Interest income$(0.2)$(1.1)$(0.4)$(0.2)$(0.3)$(0.2)$(1.7)$(0.7)
Foreign currency exchange (gain)/loss(1.0)4.5 5.1 1.3 (0.1)2.5 8.6 3.7 
Pension cost/(benefit) other than service costs0.7 0.6 0.7 (1.1)(1.1)(1.0)2.0 (3.2)
Other(0.9)(3.2)— 0.2 — (0.3)(4.1)(0.1)
Other items, net - Adjusted$(1.4)$0.8 $5.4 $0.2 $(1.5)$1.0 $4.8 $(0.3)
Restructuring and related costs— — (0.2)— — — (0.2)— 
Gain on finance lease termination— — — — — (4.5)— (4.5)
Exit of Russian market— — — — 7.5 — — 7.5 
Total Other items, net(1.4)$0.8 $5.2 0.2 $6.0 $(3.5)$4.6 $2.7 
Restructuring and related costsQ1'23Q2'23Q3'23Q1'22Q2'22Q3'22Q3'23 YTD—Q3'22 YTD
Cost of products sold$0.3 $5.7 $6.5 $— $— $— $12.5 $— 
SG&A - Restructuring costs6.3 1.8 2.6 — — — 10.7 — 
SG&A - IT Enablement— — 0.2 — — — 0.2 — 
Other items, net— — (0.2)— — — (0.2)— 
Total Restructuring and related costs$6.6 $7.5 $9.1 $— $— $— $23.2 $— 
Acquisition and integrationQ1'23Q2'23Q3'23Q1'22Q2'22Q3'20Q3'23 YTDQ3'22 YTD
Cost of products sold$— $— $— $6.0 $— $— $— $6.0 
SG&A— — — 9.4 — — — 9.4 
Research and development— — — 1.1 — — — 1.1 
Total Acquisition and integration related items$— $— $— $16.5 $— $— $— $16.5 

15

Energizer Holdings, Inc.
Supplemental Schedules - Non-GAAP Reconciliations cont.
For the Quarter and Nine Months Ended June 30, 2023
(In millions - Unaudited)
Q3'23Q2'23Q1'23Q4'22LTM 6/30/23 (1)Q3'22
Net earnings/(loss)$31.8 $40.0 $49.0 $(362.9)$(242.1)$52.4 
Income tax provision/(benefit)8.6 10.4 13.3 (112.2)(79.9)12.7 
Earnings/(loss) before income taxes40.4 50.4 62.3 (475.1)(322.0)65.1 
Interest expense 42.2 42.0 42.9 42.0 169.1 41.1 
Loss/(gain) on extinguishment of debt0.3 0.9 (2.9)— (1.7)— 
Depreciation & Amortization30.5 30.4 32.1 32.6 125.6 30.4 
EBITDA$113.4 $123.7 $134.4 $(400.5)$(29.0)$136.6 
Adjustments:
Restructuring and related costs9.1 7.5 6.6 0.9 24.1 — 
Exit of Russian market— — — 0.6 0.6 — 
Gain on finance lease termination— — — — — (4.5)
Brazil flood damage, net of insurance proceeds— — — (0.2)(0.2)9.9 
Impairment of goodwill & intangible assets— — — 541.9 541.9 — 
Share-based payments4.3 8.3 4.6 3.3 20.5 3.5 
Adjusted EBITDA$126.8 $139.5 $145.6 $146.0 $557.9 $145.5 
(1) LTM defined as the latest 12 months for the period ending June 30, 2023.
Free Cash Flow6/30/2023
Net cash from operating activities $296.3 
Capital expenditures (35.4)
Proceeds from sale of assets 0.7 
Free Cash Flow for the nine months ended June 30, 2023$261.6 

Net Debt6/30/20239/30/2022
Current maturities of long-term debt$12.0 $12.0 
Current portion of finance leases0.3 0.4 
Notes payable5.3 6.4 
Long-term debt3,377.0 3,499.4 
Total debt per the balance sheet$3,394.6 $3,518.2 
Cash and cash equivalents202.4 205.3 
Net Debt$3,192.2 $3,312.9 


16

Energizer Holdings, Inc.
Supplemental Schedules - Non-GAAP Reconciliations cont.
FY 2023 Outlook
(In millions - Unaudited)


Fiscal Year 2023 Outlook Reconciliation - Adjusted net earnings and diluted net earnings per common share -(EPS)
(in millions, except per share data)Adjusted Net earnings Adjusted EPS
Fiscal Year 2023 - GAAP Outlook$187to$203$2.59to$2.80
Impacts:
Restructuring and related costs31to230.43to0.32
Gain on extinguishment of debt(1)(1)(0.02)to(0.02)
Fiscal Year 2023 - Adjusted Outlook$217to$225$3.00to$3.10
Fiscal Year 2023 Outlook Reconciliation - Adjusted EBITDA
(in millions, except per share data)
Net earnings $187to$203
Income tax provision33to56
Earnings before income taxes$220to$259
Interest expense 172to168
Gain on extinguishment of debt(2)to(2)
Amortization62to58
Depreciation 70to64
EBITDA$522to$547
Adjustments:
Restructuring and related costs40to30
Share-based payments23to18
Adjusted EBITDA$585to$595


17
+ Fiscal 2023 Q3 Earnings August 8, 2023 Exhibit 99.2

 
This document contains both historical and forward-looking statements. Forward-looking statements are not based on historical facts but instead reflect our expectations, estimates or projections concerning future results or events, including, without limitation, the future sales, gross margins, costs, earnings, cash flows, tax rates and performance of the Company. These statements generally can be identified by the use of forward-looking words or phrases such as "believe," "expect," "expectation," "anticipate," "may," "could," "will," "intend," "belief," "estimate," "plan," "target," "predict," "likely," "should," "forecast," "outlook," or other similar words or phrases. These statements are not guarantees of performance and are inherently subject to known and unknown risks, uncertainties and assumptions that are difficult to predict and could cause our actual results to differ materially from those indicated by those statements. We cannot assure you that any of our expectations, estimates or projections will be achieved. The forward-looking statements included in this document are only made as of the date of this document and we disclaim any obligation to publicly update any forward-looking statement to reflect subsequent events or circumstances. All forward-looking statements should be evaluated with the understanding of their inherent uncertainty. Numerous factors could cause our actual results and events to differ materially from those expressed or implied by forward-looking statements, including, without limitation: Global economic and financial market conditions, including the conditions resulting from the COVID-19 pandemic, and actions taken by our customers, suppliers, other business partners and governments in markets in which we compete might materially and negatively impact us. Competition in our product categories might hinder our ability to execute our business strategy, achieve profitability, or maintain relationships with existing customers. Changes in the retail environment and consumer preferences could adversely affect our business, financial condition and results of operations. We must successfully manage the demand, supply, and operational challenges brought about by the COVID- 19 pandemic and any other disease outbreak, including epidemics, pandemics, or similar widespread public health concerns. Loss or impairment of the reputation of our Company or our leading brands or failure of our marketing plans could have an adverse effect on our business. Loss of any of our principal customers could significantly decrease our sales and profitability. Our ability to meet our growth targets depends on successful product, marketing and operations innovation and successful responses to competitive innovation and changing consumer habits. We are subject to risks related to our international operations, including currency fluctuations, which could adversely affect our results of operations. If we fail to protect our intellectual property rights, competitors may manufacture and market similar products, which could adversely affect our market share and results of operations. Changes in production costs, including raw material prices and transportation costs, from inflation or otherwise, have adversely affected, and in the future could erode, our profit margins and negatively impact operating results. Our reliance on certain significant suppliers subjects us to numerous risks, including possible interruptions in supply, which could adversely affect our business. Our business is vulnerable to the availability of raw materials, our ability to forecast customer demand and our ability to manage production capacity. The manufacturing facilities, supply channels or other business operations of the Company and our suppliers may be subject to disruption from events beyond our control. The Company's future results may be affected by its operational execution, including scenarios where the Company generates fewer productivity improvements than estimated. If our goodwill and indefinite-lived intangible assets become impaired, we will be required to record impairment charges, which may be significant. A failure of a key information technology system could adversely impact our ability to conduct business. We rely significantly on information technology and any inadequacy, interruption, theft or loss of data, malicious attack, integration failure, failure to maintain the security, confidentiality or privacy of sensitive data residing on our systems or other security failure of that technology could harm our ability to effectively operate our business and damage the reputation of our brands. We have significant debt obligations that could adversely affect our business and our ability to meet our obligations. If we pursue strategic acquisitions, divestitures or joint ventures, we might experience operating difficulties, dilution, and other consequences that may harm our business, financial condition, and operating results, and we may not be able to successfully consummate favorable transactions or successfully integrate acquired businesses. Our business involves the potential for product liability claims, labeling claims, commercial claims and other legal claims against us, which could affect our results of operations and financial condition and result in product recalls or withdrawals. Our business is subject to increasing government regulations in both the U.S. and abroad that could impose material costs. Increased focus by governmental and non-governmental organizations, customers, consumers and shareholders on environmental, social and governance (ESG) issues, including those related to sustainability and climate change, may have an adverse effect on our business, financial condition and results of operations and damage our reputation. We are subject to environmental laws and regulations that may expose us to significant liabilities and have a material adverse effect on our results of operations and financial condition. In addition, other risks and uncertainties not presently known to us or that we consider immaterial could affect the accuracy of any such forward-looking statements. The list of factors above is illustrative, but by no means exhaustive. All forward-looking statements should be evaluated with the understanding of their inherent uncertainty. Additional risks and uncertainties include those detailed from time to time in our publicly filed documents, including those described under the heading “Risk Factors” in our Form 10-K filed with the Securities and Exchange Commission on November 15, 2022. Forward-Looking Statements

 
Non-GAAP Financial Measures The Company reports its financial results in accordance with accounting principles generally accepted in the U.S. ("GAAP"). However, management believes that certain non- GAAP financial measures provide users with additional meaningful comparisons to the corresponding historical or future period, and are used for management incentive compensation. These non-GAAP financial measures exclude items that are not reflective of the Company's on-going operating performance, such as restructuring and related costs, acquisition and integration costs, an acquisition earn out, the loss/(gain) on extinguishment of debt, the costs of the May 2022 flooding of our Brazilian manufacturing facility, the gain on finance lease termination, and the costs of exiting the Russian market. In addition, these measures help investors to analyze year over year comparability when excluding currency fluctuations as well as other Company initiatives that are not on-going. We believe these non-GAAP financial measures are an enhancement to assist investors in understanding our business and in performing analysis consistent with financial models developed by research analysts. Investors should consider non-GAAP measures in addition to, not as a substitute for, or superior to, the comparable GAAP measures. In addition, these non-GAAP measures may not be the same as similar measures used by other companies due to possible differences in methods and in the items being adjusted. We provide the following non-GAAP measures and calculations, as well as the corresponding reconciliation to the closest GAAP measure in the following supplemental schedules: • Adjusted Net Earnings and Adjusted Diluted Net Earnings Per Common Share (EPS). These measures exclude the impact of the costs related to acquisition and integration, restructuring and related costs, an acquisition earn out, the loss/(gain) on extinguishment of debt, the costs of the flooding of our Brazilian manufacturing facility, the gain on finance lease termination and the costs of exiting the Russian market. • Non-GAAP Tax Rate. This is the tax rate when excluding the pre-tax impact of acquisition and integration costs, restructuring and related costs, an acquisition earn out, the loss/(gain) on extinguishment of debt, the costs of the flooding of our Brazilian manufacturing facility, the gain on finance lease termination, and the costs of exiting the Russian market, as well as the related tax impact for these items, calculated utilizing the statutory rate for where the impact was incurred. • Organic. This is the non-GAAP financial measurement of the change in revenue or segment profit that excludes or otherwise adjusts for the change in Russia and Argentina operations and impact of currency from the changes in foreign currency exchange rates as defined below: • Change in Russia Operations. The Company exited the Russian market in the second quarter of fiscal 2022 due to the increased global and economic and political uncertainty resulting from the ongoing conflict between Russia and Ukraine. This adjusts for the change in Russian sales and segment profit from the prior year post exit. • Change in Argentina Operations. The Company is presenting separately all changes in sales and segment profit from our Argentina affiliate due to the designation of the economy as highly inflationary as of July 1, 2018. • Impact of Currency. The Company evaluates the operating performance of our Company on a currency neutral basis. The Impact of Currency is the change in foreign currency exchange rates year-over-year on reported results, which is calculated by comparing the value of current year foreign operations at the current period USD exchange rate versus the value of current year foreign operations at the prior period USD exchange rate. The impact of currency also includes gains/(losses) of currency hedging programs, and it excludes hyper-inflationary markets. • Adjusted Comparisons. Detail for adjusted gross profit and adjusted gross margin are also supplemental non-GAAP measure disclosures. These measures exclude the impact of costs related to acquisition and integration, restructuring and related costs, an acquisition earn out, the costs of the flooding of our Brazilian manufacturing facility, the gain on finance lease termination, and the costs of exiting the Russian market. • EBITDA and Adjusted EBITDA. EBITDA is defined as net earnings before income tax provision, interest, the loss/(gain) on extinguishment of debt, and depreciation and amortization. Adjusted EBITDA further excludes the impact of the costs related to restructuring, exiting the Russian market, gains on finance lease termination, the costs of the flooding of our manufacturing facility in Brazil, impairment of goodwill and other intangible assets, and share based payments. • Free Cash Flow. Free Cash Flow is defined as net cash provided by operating activities reduced by capital expenditures, net of the proceeds from asset sales. • Net Debt. Net Debt is defined as total Company debt, less cash and cash equivalents. • Currency-neutral. Currency-neutral excludes the Impact of Currency as defined above on key measures. Hyper inflationary markets are excluded from this calculation.

 
+ Financial Results Third Quarter 2023

 
METRIC Third Quarter 2023 Free Cash Flow* Adjusted Gross Margin* Third Quarter $126.8 million(3), or margin of 18.1% of net sales • Unfavorable currency had a negative impact of $3.4 million Adjusted Gross margin was 38.8%(1), down 160 bps • Up sequentially 90 bps from Q2 2023 All comparisons are to Fiscal 2022 comparable reported results. * See non-GAAP reconciliations in the Appendix. Adjusted EBITDA* Third quarter free cash flow of $69.4 million(2), or 10% of net sales • Within range of our long-term algorithm of 10% to 12% Key Metrics – Third Quarter Net Sales* Third quarter Net sales on a reported basis of $699.4 million, down 3.9% • Organic net sales down 2.7% (1) GAAP gross margin of 37.9% (2) Operating cash flow of $296.3 million (3) GAAP net earnings of $31.8 million Net Debt* Third quarter debt paydown of $44 million • Total debt paydown in FY’23 of $200 million 5

 
Q3 FY23 Organic Net Sales Decline of 2.7% Organic Decline -2.7% 6

 
FOR INTERNAL USE ONLY – DO NOT DISTRIBUTE Positive Battery Volumes Recovery -20.0% -15.0% -10.0% -5.0% 0.0% 5.0% 10.0% 15.0% 20.0% Total U.S. MULC + Amazon Volume Sales % Chg YA Dollar Sales % Chg YA Sources: Circana (IRI) Total US MULC 5/23/2021 – 7/16/2023; Profitero Amazon May 2021-July 2023 Battery volume recovery has lagged our expectations year to date but is continuing to recover with convergence in the latest 4 weeks at positive value and volume. 7

 
Extending and Expanding Project Momentum to a Three-Year Program With Increased Savings and Working Capital Benefits $130 to $150 MILLION In Run Rate Benefits anticipated to be achieved by end of FY25 A $50 million increase from previous estimate $150 MILLION In Working Capital Improvements One-time Cash Pre-tax Expense ∼75% of Savings $95 to $110 MILLION A $50 million increase from previous estimate 8

 
Strong Cash Flow and Debt Paydown Over the Past Four Quarters Q3 FY 2022 (Ended June 2022) Q3 FY 2023 (Ended June 2023) Last 12 Months LTM FCF % * LTM FCF % * Net Leverage Net Leverage 6.1x(2) (0.9%) 5.7x 12.1% ($ in millions) (1) Total Debt reduction on the senior notes, term loan and revolver was $263 million over the past 4 quarters which included retiring some notes at a cash discount. (2) Expected to reduce leverage by over half a turn by the end of Fiscal 2023 * See non-GAAP reconciliations in the Appendix. 9

 
+ Updated Outlook Fiscal 2023

 
Key Metrics - Fiscal 2023 Outlook METRIC Fiscal 2023 Outlook All comparisons are to Fiscal 2022 comparable reported results. * See non-GAAP reconciliations in the Appendix. Low Single Digit Decline • Fourth quarter expected to be roughly flat to prior year Organic Net Sales $585 to $595 million • Fourth quarter $173 and $183Adjusted EBITDA* 150 – 200 Basis Point Improvement • Fourth quarter 350 to 400 bps improvement to prior year Adjusted Gross Margin $3.00 to $3.10 • Fourth quarter $1.10 to $1.20Adjusted EPS* $130 - $150 Million in Savings by the end of FY2025 • FY2023 savings of approximately $45 to 50 millionProject Momentum 11

 
Appendix Materials 12

 
Non-GAAP Reconciliation: Consolidated Net Sales (in millions) Organic revenues is the non-GAAP financial measurement of the change in revenue or segment profit that excludes or otherwise adjusts for the change in Argentina operations and impact of currency from the changes in foreign currency exchange rates as defined below: • Change in Argentina Operations. The Company is presenting separately all changes in sales and segment profit from our Argentina affiliate due to the designation of the economy as highly inflationary as of July 1, 2018. • Impact of currency. The Company evaluates the operating performance of our Company on a currency neutral basis. The impact of currency is the difference between the value of current year foreign operations at the current period ending USD exchange rate, compared to the value of the current year foreign operations at the prior period ending USD exchange rate, as well as the impact of hedging on the currency fluctuation. 13

 
Non-GAAP Reconciliation: Adjusted Gross Margin (in millions) Adjusted gross margin as a percent of sales excludes any charges related to restructuring programs, the costs of exiting the Russian market, the costs of the flooding of our manufacturing facility in Brazil and acquisition and integration costs. 14

 
Non-GAAP Reconciliation: Free Cash Flow (in millions) Free Cash Flow is defined as net cash provided by operating activities reduced by capital expenditures, net of the proceeds from asset sales. 15

 
Non-GAAP Reconciliation: Adjusted EBITDA (in millions) EBITDA is defined as net earnings before income tax provision, interest, loss/(gain) on extinguishment of debt, depreciation and amortization. Adjusted EBITDA further excludes the impact of the restructuring and related costs, the costs of exiting the Russian market, the gain on finance lease termination, the costs of the flooding of our ma nufacturing facility in Brazil, impairment of goodwill and other intangible assets, costs related to acquisition and integration, an acquisition earn out and share- based payments costs. 16

 
Non-GAAP Reconciliation: Net Debt (in millions) Net Debt is defined as total Company debt, less cash and cash equivalents. 17

 
Non-GAAP Reconciliation: FY 2023 Outlook (in millions) 18

 
v3.23.2
Cover Page
Aug. 08, 2023
Cover [Abstract]  
Document Type 8-K
Document Period End Date Aug. 08, 2023
Entity Registrant Name Energizer Holdings, Inc.
Entity Incorporation, State or Country Code MO
Entity File Number 1-36837
Entity Central Index Key 0001632790
Amendment Flag false
Entity Tax Identification Number 36-4802442
Entity Address, Address Line One 533 Maryville University Drive
Entity Address, City or Town St. Louis
Entity Address, State or Province MO
Entity Address, Postal Zip Code 63141
City Area Code 314
Local Phone Number 985-2000
Title of 12(b) Security Common Stock, par value $.01 per share
Trading Symbol ENR
Security Exchange Name NYSE
Written Communications false
Soliciting Material false
Pre-commencement Tender Offer false
Pre-commencement Issuer Tender Offer false
Entity Emerging Growth Company false
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