ENR - Earnings call transcript Q1 2025 | Energizer Holdings, Inc.

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Operator

Good morning. My name is Sylvie, and I will be your conference operator today. At this time, I would like to welcome everyone to Energizer's First Quarter Fiscal Year 2025 Conference Call. [Operator Instructions] Also note that this call is being recorded.

And now I would like to turn the conference over to Jon Poldan, Vice President, Treasurer and Investor Relations.

conference. your begin may You

Jonathan Poldan

Good morning Conference Quarter XXXX Energizer's welcome to Call. First Fiscal and

today President website, Chief Joining Officer; Mark Relations will are me LaVigne, the on Drabik, replay this Investor Vice be A available and of and Executive President Officer. and our Financial section of call energizerholdings.com. John Executive Chief

the posted on also In slide providing deck is addition, detailed website. quarter the financial results for our

results among risks business to from are other SEC. will we forward-looking about included and Other We make based financial future statements. factors management's not actual are differ performance, which that file These in During could reports expectations these undertake statements the we results statements. with call, cause on materially do to matters. cause the statements are the and statements and company's update differ forward-looking may current from subject materially these uncertainties, actual these to to

our to press reconciliation also release We our available measures. today, comparable financial issued in measures on A non-GAAP earlier of which presentation measures shown website. to is refer GAAP is our non-GAAP financial

year all category XXXX. the information fiscal includes comparisons year the all regarding we comments noted, Information Energizer's and believe a and concerning period sales. and quarter share where market on is call reasonable. The and pertain same be our to e-commerce relates otherwise both fiscal related from categories the Energizer's based and estimated brick-and-mortar this on industry data internal to to we Unless in year to data, discussed analysis retail categories to compete estimates battery prior

turn to like the call would Mark. I over that, to With

Mark LaVigne

results a the delivered us and year everyone, morning, quarter XXXX. had for strong joining first start to We our fiscal thank of great and Good today. in you

growth nearly $XX adjusted we expanded We Auto X% through Specifically, our our by off. positioned organic X%. organic gross per of by XX of to points. earnings million X%. are We and paid of growth we paying achieved adjusted down grew the entered drive We basis and investments margin and We share net Care strategic sales delivered Batteries debt. of year initiatives in growth XX%,

Momentum, discuss to the improve top has flexibility increase growth quarter. sales in and line the XX% have margins and our As were full this to us margins expansion in gross year. reached margin our our the Project which us The outlook our which given will adjusted more provided able strong a to year growth confidence been for enabled the to organic reestablished invest. start while Jon to by the moment, We continuing achieve

enabling in the program, growth, margin With our strong reduction X earnings it as margin enable improvement. quarters expansion top remaining and tenth as drove in continued to meaningful The investment quarter. consecutive combination growth expect performance the of we line for well debt

results Our remained certainly and Battery the globally are our by in volume category positive, U.S. bolstered health the categories. of both

Importantly, with converging we well. in manner trends This consistent value resulting value volume and expectations. as seeing in is our are improving a

also The Auto to continued category growth. show

a including in underpinnings, growth park with expansion international shift fundamentals, category combined These care the steady car increase solid strong seeing a our are category in quarter. continued activities. of We and the for drove do-it-yourself brands car age towards consumer the

the turning we provide like strategic it fiscal our The areas of forward initiatives. would look for look Project both how to Momentum year. over first growth rest how and I both these of to the quarter a leveraging John, highlighted on are before And

savings quarter 'XX nearly year, million very for with Project the million There $XXX the to in finish fiscal in Project Let's was program. approximately the the savings $XX strong come start savings significant total and Momentum. expect million to and of roughly quarter the in generated growth. is drive with and exception. Momentum over the life of We of $XX this program. balance this generated no more year to earnings for we and helped

We for ongoing expect identified pricing where forward. previously to We've the innovation market invest Momentum growth expansion, digital Distribution capture economy. consistent capitalize of and revenue areas five and Project growth. on will going we success management, and

across This in quarter on markets. In our QX U.S. in demonstrates the with and customers the and with were we in several from of impact new expanded areas These those biggest gains coming business distribution. quarter, existing progress in channels, broad-based both the international ones. the

to distribution expect tailwind the a be the for year. We balance of

'XX. our partnership big with for innovative unveiled the in we part Racing. lines, series Oracle some November, last product newest Innovation us of podium in our most Bull including Red On Armor will a call developed play All fiscal also and

We to positive. report indicators the are pleased very are early

have large the the be will on distribution total, globe. across retailers We secured more States, more. United U.K. XX,XXX than and across locations retail at series podium the Australia, In in shelves

and areas and for. quarters The of each investments out them over in our our management build expect to generate is this future years. also business in having market pipeline our broad-based consistent we of growth algorithm economy growth that expansion, and pricing fiscal invest drive like financial revenue time We digital calls benefit to the and expanding can

John. and and excited each and strategic in over very initiatives. turn quarter about we these up second with across seen first call a the even a level, I is entered pipeline confidence will robust. wrap the greater of are our what we quarter strong From delivered to the high We areas already have

to strategies on start strong financial that XXXX to adds Our outlook. the right deliver our confidence executing our year the we to are

our John will quarter it the details on more outlook. to turn and over for I now

John Drabik

November to in Mark, organic first morning, net share report with solid and in earnings adjusted results and provided we the our and both gross everyone. per with quarter am good Thanks, margins I line pleased sales expectations. guidance adjusted above

year. rest walk through greater detail quarterly the you for our and of now will expectations I our in results update the

revenue up quarter, net sales the increasing organic reported For X.X% with were X.X%.

million organic were market for to by pleased by holiday $XX top which noted driven growth and see by and shift is X% Even strong last X%, sales, led we quarter we Our business, smallest though quarter organic of earnings first business gains, battery an during the the quarter's hurricane-related call. orders. posted distribution of gains offset expansion partially Auto earlier our growth, digital in international economy distribution growth line

points negative Adjusted promotional in partially The XX planned by XX%. input strengthening U.S. partially and and offset businesses as volume pricing offset growth margin an from dollar. by both product of $XX pricing Momentum the benefits million were costs quarter. promotional and impact in These was savings the increased were biggest by holiday gross as improvement X.X% of well the this in basis support Project drivers of to investments the season. investments

by roughly The flat a SG&A a of of as $X.X increase dollar sales outstanding. was year-over-year support lower brands XX.X% due Interest in sales Adjusted of behind a A&P investment by business was our $X.X key percent X.X%, an driven the average and was million increase on season. holiday percent primarily million. and and basis. increase to or debt to as expense an decreased

and adjusted and of EBITDA growth $XXX.X million respectively. of $X.XX XX%, and representing We and adjusted per X% earnings share delivered

of $XX net We million nearly cash of or million also north free of $XX of X% additional down sales debt. an generated and paid flow

XXXX. to turning for fiscal outlook our Now

call to to full our organic year while and raising X% X% be earnings Following the first our adjusted X% reaffirming previous versus outlooks. in sales operating adjusted quarter, up guidance and about our strong per performance EBITDA we our share X%, to are

markets well We both anticipate consistent organic as the driven and product U.S. X growth distribution as gains quarters international behind next new performance in the throughout multiple by continued launches. strong

current create pricing sales reported in partially and to resulting will We at revenue, headwind offset to gains. continue in dollar The promotional which also in also intend continued U.S. activity, reported projected investing a X%. to net volume of the X% the to range which growth has strengthen, rates

XX margin basis range savings to Project $X.XX earnings continue million than million to original per $X.XX adjusted roughly points our and XX%. to respectively. expect of EBITDA to adjusted and Momentum million, in We adjusted of more $XXX gross and of $XXX $XX share expansion

range million of $XXX $XXX pay We continue a million to expect and in net ratio to XXXX end X.Xx. debt down with around leverage of the

to our of XX% net initiative. million, we operations expected flow $XX packaging still And to be the to in to of by plastic-free million are be investments sales. our cash and free IT, $XX X% expenditures expect across driven continued of Capital in range range the

product I Momentum would savings expect in the growth also and color on growth launches margin additional reported by up see as the range business. We expected flat we the flat be dollar. X% foreign new to and provide to we year-over-year strength Project like to project currency We by some And XX.X% promotional international in of the Auto Care U.S. and gains, of second distribution organic headwinds. activity X% driven sales anticipate net X% largely pricing of our from to to at and gross continue to be pressure adjusted offset are as quarter.

We forecasting adjusted $X.XX The growth digital prior in year-over-year decline is range by $X.XX in compared increased $X.XX to being per transformation the primarily year. earnings are initiatives. investments of share in the to and driven

Now I'd for like Mark to to turn closing the remarks. call over

Mark LaVigne

Project and Momentum this year, growth, what's providing which invest for great through strong to the Thanks, ahead. necessary we flexibility to quarter. John. start has excited saw we're delivered come A the for results

high level deliver our of for long-term have in from operating shareholders. a position value to are We our a strength and of ability confidence

call the questions. for open Now let's

Operator

first Truist Instructions] Your Bill at be question will Securities. [Operator Chappell from

William Chappell

First tariffs. question, [indiscernible] the topic on to

or America, manufacturing I fairly local Europe, batteries. batteries U.S., for domestic think for in you're Latin manufacturing

about some that of it kind And would auto And look question talk you so can benefit, then a maybe, Would of label have? what as your especially for business. the tariffs at manufacture you oversees? private impact same have competitors

John Drabik

the start exposure. kind Bill, with Yes, I'll of

really into market -- hit momentum yes, market leaned So for production. we you it, with in

us last consumption about procurement U.S. X% I for helps that of our is talked some that So from to exposure. quarter COGS. And China of minimize our

not it's huge. So

and the our procure Mexico so you we in not mix, less of throw COGS X% now large. those into If from markets, really two than Canada

is anything to thinking strategy. of tariffs taking the we're optimizing our out we'll by pricing. way that can't then we sourcing mitigate we're it the think I get to these committed continue system about And

Mark LaVigne

the or in including On when produce China. Mexico tariffs, produced even private side, is tariffs competitors some about do competitive label -- China think particular, you of our in

retailers would on becomes what opportunities would would landscape there as How to what be tariffs to So react react that that. the be those, pricing see would and how as clear. to we the may be details tariff would implemented have

John Drabik

clear, were to just my Bill, be consolidated. numbers

Auto. and So Battery that's

William Chappell

results Got the it. quarter And line then like, looks -- and overall maybe strong the top for organic it growth. obviously, just characterize I mean,

better that how gives expected? and the Maybe you the Was than can consumer of expected characterize in going Was it as season? holiday kind kind forward? you it terms of confidence of

Mark LaVigne

it was think holiday season I for Look, solid a us.

one in in November robust October with had turned patterns interesting an of nicely different was a a sort was not with that we hurricane think saw you seen I season, tailwinds the December and really from started consumer it previous standpoint years. think of what shopping with I late in holiday us particularly around a then you month

with really the out way it But gave the confidence played outlook our line pleased full to we're year. the raise And for us. QX us top for again,

Operator

Next be question will from UBS. at Peter Grom

Peter Grom

everyone. good and morning, operator Thanks,

I what tariffs. So get reference about Bill seeing just perspective kind a with lot to hoping perspective? you're some from just was cost input talking can of on to change Obviously, was an what in

you your kind think bridge But and your in update what just the of to across -- you're get key how seeing would gross year? terms an margin through balance of the of baskets cost about kind inflation of and love

John Drabik

a kind we're it's say not were where from of the mixed. we quarter big last I outlook. Well, seeing gave we would change when

like silicone offsets copper, business. We continue we buy to some of got like those we've and some the on some the some things gas Auto areas, corrugate, for pressure lithium zinc, of nickel, but see cost that with

modest benefit input So from costs. a and net-net, we're materials calling for

we labor. coming of think of especially last where to out quarter continues are energy a we bit some rates, so. the some saw the I And an over or Asia be uptick freight little in and then seeing pressure on of

our, improvement full that. we watch for feel to of continue points we'll the call good for So XX about basis But year.

Peter Grom

sourcing just differences. then response just your And Great. follow-up on on to this landscape and Bill's the a or question question competitive

do of I kind down not differences? given could this an mean, being to that just road? business Or gain foresee you business to with your kind impact retailers be opportunity do these the an think you of the really additional

Mark LaVigne

question. the appreciate I Peter,

into it I it's come what or equation one the think think are I think we lot. of of an one. trade to down And going there. for be. And restrictions any a do it's that a trying interesting a tariffs lot to bit might details we're solve a trade multivariable about of

at impact in think situations and to Certainly, So continue what types sure to going out job turn we are changes into it's we'll look opportunities, they how work to in be. play matter details our the make the and landscape these continue any terms of toward I would to that. the of and

is I inside business any sure that can make question, once we to that, look it's expand walls beyond opportunities think first react Bill's above time we think accordingly. where have our of which turn around create four we is have mitigate to with these we've and may I and sure that make that. And to then and done see John and order where started we impact

Operator

from will at be Teixeira question JPMorgan. Next Andrea

Shovana Chowdhury

This on is Shovana Chowdhury Andrea. of behalf

you line, bottom maintain but line. top the You raised the then

back mean And higher-than-expected negative on can consumer you business? how you behavior, into also quarter? rest elaborate of in on see are value-seeking the year? the -- you're a the anticipating So promotion behavior fiscal seeing front please the this the like investments pricing And on this trending a does was with you what do

Mark LaVigne

question, of your for your first to last question. then turn over the John Sure, start I'll and Shovana. I'll part with it

consumers months, of you're is last that think deliver consumer consumer. where over they cautious they a looking the as our pretty will really caution seeing of They're they are a I they're from but looking have habits which consistent the on XX are of that income when there And for to and the And XX level you've for I levels. innovation. accordingly value-seeking, the think depends value, you're the many within seeing think out and been think consumer I I respond to standpoint, from heard resides and stability you stable peers, them.

consumer at responding with a events the full different It don't I changing a bit all, may itself shift lends that think our quite it's are make to some know does we in got the consumers portfolio portfolio, cautious but I we've And our of I consumer environment. is occurring. all So where dramatically. from really and a macro that landscape are sure least they because they advantage But any that leveraging have. think the brands we're to and well, meeting within portfolio have stable needs

John Drabik

rest about year I'll we're asked investments, the how splits about and the the but kind And I then you Yes. know thinking the about of maybe just outlook. talk the for of

year, line be X% to that So expect talked X% we the organic top for category of those as quarter-over-quarter distribution growth, that of the of to product some about. in those we've we've new solid good trends growth launches rest pretty got kind expansion,

do we when the we we then on would and launches. I as little investments, third expect -- anticipate X% heavy And having quarters although do to still in talk expect A&P, you about bit those be that over a second

about today. that I talked we've So of that be little bit will impact a an think

also about color SG&A growth had been the our the to And couple to we've seen talking last in SG&A I kind these some some going be on given continue then been and of transformation some the to investments that for initiatives of number. of of quarters, and digital what is making I've

So we're a expecting quarter. like more $XXX probably million

kind the of forward, you of going rate. that's as more think run that So about

whether on, pay of it all interest areas pretty the gave or are -- tax reductions rate, then was other we of outlook that consistent. kind And interest those

one have that strengthen. that the that continue seen I other would to The thing is dollar add to we

kind that's flowing of And so through.

the organic is in dollar. offset of the getting that we're increase getting So growth the some by

Operator

at be from Evercore. Rob Next Ottenstein question will

Robert Ottenstein

looks the behavior. of pretty terms mentioned You that stable in consumer

way not pack be what new in? that this give in that of at least shelf And looking to know at then distribution? any around sequentially you there's to any want the change touched -- I much private and things. should space? color quarter Any any about color take channel, can that, on comes but us on color label? So more additional Just it, quantify more specific those more you've on size, of point, we forward, to terms kind And that be

Mark LaVigne

Robert. Sure,

that really in guide It's it's club consolidated Let all me wins know. say Auto, in the of sort an built today. are mean, those, start It's one, color I broad-based. to dollar both It's provided we would let decisions the if distribution known just miss I It's the distribution, Batteries. it's into so the in I and in It's address market. in me channel. channel. U.S. international on

really gains really So distribution those been have internally. with as of sort five strategic make that that focus the able initiatives we've pleased growth we on to we

is I new but make a They're is my they question, consumer consumer answer comfortable In was And behavior. shifting value-seeking the that very consumer their they're muscle is terms not which would there in look, the has, also shifting cautious, -- embedded the channels. of comfortable -- stable, found purchases. that very where

think the meet of as very promotions, investment that's so have and the And sales. in well that make top with I consumer nimble line correspondingly, driving sure they CPGs be consumers to where how terms you're to with innovation as both

So a it's out and to new think muscle we're consumers, likely there I is that found of here stay. seeing

miss, questions Robert? I What did

Robert Ottenstein

Yes.

the I I It's distribution board, like mentioned that's very think gains terrific. possible? broad-based, that which is are hit follow-up, would the So on but if you a kind you it, of right? across

years and bit that's to any importantly, So about anyway, going at more quantify something number can in can expect this this forward? of little repeatable way. that's you're you that few talk think distribution kind working what But is sort doing to you also, the internally And gains? one, of those that I a next in get rate

Mark LaVigne

John year. of sort of what distribution a qualitative this. with of Robert, over looks the And I'll can kind the you like balance then view give start of

this business. Project we sure about And right invest. started to to we've the done Momentum. were we internally what make way. to with we in sure be first had went we've P&L recovered with flexibility that Momentum. to Project think We had margins that our our done I the We the able We make in in building is

sure About line. play is Project midway the of P&L, back that through to in Momentum, part had of knew growth the get we other top finish make on which the we sort consistent to we

to And for so line X% top I our would year-over-year achieve. calls X% roughly basis. us That's to algorithm what for growth look

of continued those is and what sort revenue to We Those that areas X% pricing market them basic we digital drive us highlighted And started are business, does we economy. within innovation, is areas and are growth focused on. and distribution, which on management, before them even we've that gives our which areas to it tackling blocking focus is that And expansion we've externally. consistently. where just of focus highlighting what X% can the

Now not exact single every those are all five to the year. going deliver of same

to to that medium X% these future invest, are to out we growth. short, think ability areas that to the ratable make years to do term the only investments back going the and we well. X% year, us get not to in spread that And deliver in gives it long as but fiscal five both So that and so this

quantitative John, then, of And of on view kind the things.

John Drabik

Robert. Yes,

distribution innovation roll to the launches. growth in mean, big point, digital commerce and I year So forward then Mark's our is driver this

we're year. about to of Distribution, of XXX kind expecting points growth basis generate this

Robert Ottenstein

let's do say? right of the over next to long-term XXX X we X our years, kind of that is something be range And would model, as kind the

John Drabik

total? In

Robert Ottenstein

Yes.

Mark LaVigne

for algorithm to the X% per year. calls X% what us. financial That's

Robert Ottenstein

but specifically? distribution Right, coming from

Mark LaVigne

going year could year. They I pull -- not X%. to is that distribution look, and X% consolidated what growth change a be a digital -- do Well, the these I that year-over-year. heavy economy to of lighter areas. from we're may a five I It may -- would composition would would

basis quarter or expect They will consistent to these we even year build on of to from. deliver in basis a the We a not update a year-over-year. growth rates X% will, growth terms fiscal five. emerge I on that X% basis total, for would in on in each where of But

Operator

Next question Canaccord McNamara be will Genuity. at from Brian

Brian McNamara

been it's difficult quarters, to to over and mean Don't distribution it's pretty horse but very last several on the consistent dead just track. gains, a theme beat a the

So who retailers these retailers what I if some but I already, think other your are not, coming displacing? companies selective know are this the of you lease space as that with of to being are categories? or answered Because I And of cover. from shell some expanding pretty are you kind gains space shelf

Mark LaVigne

you we're a of is Brian, value frustrating coming In at main competitor label. bit a distribution. retailer. to is but for brands we're getting probably, really specific answer more from it some expanded given some our distribution, point from versus instances, the getting instances, Yes, new is private some some or In

and saw so. the we organic look quarter. So outlook. nearly leverage to portfolio do to X% all drive we do our overall built are full into it growth -- this We We financial

X% You're going fiscal for to X% the to year. see

this then So and off and say way it announced showed to one like the that in would terms I to be we're this way, our our looking shoppers. retail that at we're tracking let partners that's and we And their -- it. brands of the

going you're lot been up if see things of these to retail, in soon. already show very a not So

Operator

Next from Carla at question will JPMorgan. Casella be

Carla Casella

Follow-up then question. one question and

-- So the the on one the sourcing. follow-up

us versus industry? are lighting Is versus for China in you the give or you it bit more products color little both Batteries Auto or just key Can Mexico what a Care? made

John Drabik

that lights gauges, acquiring bigger us Auto gets especially out something of the of we're produced components, in then For a is of the things are areas which that like couple China. And that, hoses China. some specifically, still and like

China some are around the out Battery. in we'll biggest. materials some two an eye Yes. categories keep There's there raw we smaller that that are those probably But on. And do

Carla Casella

you That's looked to as environment talked your potential growth or would that be the Okay. then pillar And well? at growth whether and a Have M&A you've great. for talk about can all internal just opportunities.

Mark LaVigne

emphasis pay we near in is to keep to to continue there, small pulse the bolt-on something, of term. out look continue for and to But on But our to acquisitions. look we'll always what's be we sort down Carla, going It's at, what's continue hitting that a market. the

there. what there some larger out But not are I us. seeing we're And scale things look from for is anything would

would scale, continue on we be can to on focus so think just I paydown. debt it a smaller

Operator

[Operator we Reuter from of America. will Instructions] Next, hear Bank at William

William Reuter

question My the of one is e-commerce, pillars. five on growth

industry the And where about talk to you're in growing you any market? relative channel? in in penetration that is brick-and-mortar terms private Can is label in the if how U.S. the seeing and of increases it competition

Mark LaVigne

be E-commerce a of in I categories. think, continues growth I a our premium shares you would to are from stable private source label And seeing say overall, standpoint.

And growth so you're not international seeing any you in the and nice shift to are private U.S. markets. label, seeing in both but opportunities,

our about we in XXXX. business For year aspirations roughly is in November, this in fiscal for talked it growth us. XX% for that

to seeing that certainly exceed growth participate and in we're So e-commerce. the category in going we're

William Reuter

Got could shelf related new that in is expansion in that the that then given and if distribution? retain is to lap the secondarily, you're you've such margin to fiscal that you somewhat onetime-ish once it. the pricing space 'XX. customers promo promotional And you year some have nature you offers And investing, it that gross those

John Drabik

Yes. There and distribution is product launches. new some related new the to the

we year, I to more then get as investment the expect way front-end end about to and year. points full think Bill, work from that less the year, looking is about at back this we're for we're overall to but XXX the down loaded of way I the basis that the our be it holiday thinking

William Reuter

it. Got

did refer margins gross basis quantitatively? So just to said Or XXX a you what points? to the increase in when be to clear, that headwind that's the promotions,

John Drabik

got fall through our top points -- about margin. into would is That investment. of that Yes. line. XXX pricing Yes. basis That's We've

I about think points for turns the basis XX probably into margin, year. the for that full

Operator

have LaVigne, At questions. other this Mr. time, no we

Mark LaVigne

the everyone us a I interest joining Energizer. has your rest in of for Thanks hope today, great day.

Operator

Ladies indeed time, your conclude again, does lines. you conference Once that thank please And gentlemen, call your you, Thank disconnect this at today. and we for ask you sir. attending. for this

Energizer (ENR) 4 Feb 252025 Q1 Earnings call transcript