1. ENR reported net sales of $662.9 million, nearly flat YoY. 2. Adjusted gross margin improved to 40.8%, driven by Project Momentum. 3. Tariff uncertainties and cautious consumer outlook tempered future sales predictions. 4. SG&A expenses rose due to investment in digital transformation. 5. Expected EPS range for FY 2025 is $3.30 to $3.50.
Although gross margins improved, net sales showed little growth and caution in projections may hinder price movement. Historical trends indicate investors react unfavorably to lowered expectations.
Investors usually focus on earnings reports, especially on margins and forecasts, impacting stock valuation significantly.
Immediate concerns about tariffs and consumer spending might affect stock performance in the next few quarters, similar to reactions seen in Q2 2024.
"We are proud of our performance in the quarter, as our investments have enabled continued momentum in our top-line and the operating flexibility to effectively offset the impact from tariffs to our fiscal 2025 results," said Mark LaVigne, Chief Executive Officer. "We delivered organic Net sales growth for the fourth consecutive quarter, expanded Gross margins, and achieved Adjusted Earnings per share at the high end of our guided range."
"As we look ahead, we are tempering our outlook to reflect a more cautious consumer over the balance of the year; however, we remain confident our investments in the business will continue to drive our long-term algorithm and value creation."
For the quarter, we had Net sales of $662.9 million compared to $663.3 million in the prior year period.
| Second Quarter | % Chg |
|---|---|
| Net sales - FY'24 | $663.3 |
| Organic | 1.4% |
| Change in hyperinflationary markets | 0.2% |
| Impact of currency | (1.7%) |
| Net sales - FY'25 | (0.1%) |
Gross margin percentage on a reported basis was 39.1% versus 38.2% in the prior year. Excluding the current year restructuring costs and network transition costs and the prior year restructuring and integration costs, Adjusted Gross margin was 40.8% in fiscal 2025, compared to the prior year Adjusted Gross margin of 40.5%.
SG&A, excluding restructuring and acquisition costs, was 18.8% of Net sales for the second quarter, or $124.5 million, compared to 17.2%, or $113.9 million in the prior year.
| Second Quarter | 2025 | 2024 |
|---|---|---|
| Net earnings | $28.3 | $32.4 |
| Diluted net earnings per common share | $0.39 | $0.45 |
| Adjusted Net earnings | $49.4 | $52.1 |
| Adjusted EBITDA | $140.3 | $142.5 |
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 second 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/6l5VGlBKO0z
This document contains both historical and forward-looking statements. Forward-looking 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.