Energizer 2001 Annual Report Download - page 14

December 31, 1999 were above historical norms due to Y2K-driven ordering. Following January 1, 2000,
consumer demand for batteries has generally lagged behind historical growth rates, reÖecting economic
slowdown in much of the world, and Energizer's sales to the trade have been further reduced as retail
inventory levels have declined.
Currency devaluation, relative to the U.S. dollar, in Australia, New Zealand, the Philippines and other
countries in the Asia PaciÑc region has been unfavorable to Energizer during 2000 and 2001. The Euro and
certain other European currencies have also been unfavorable to Energizer in 2000 and most of 2001. A
signiÑcant portion of Energizer's product cost is more closely tied to the U.S. dollar than to the local
currencies in which the product is sold. As such, currency devaluation relative to the U.S. dollar reduces
margins to the extent increased costs in local currency terms are not oÅset by local currency price increases.
Changes in the value of local currencies may continue to impact segment proÑtability.
REPORTING PERIOD SYNCHRONIZATION
Energizer historically reported results of international operations on a one-month lag. As a result, prior
year amounts represent results of international operations for September through August combined with the
U.S. results for October through September. Beginning in Ñscal 2001, Energizer has synchronized interna-
tional operations' reporting to be consistent with U.S. reporting.
The impact of the synchronization on the prior year results was to decrease sales by $28.4 to $1,899.3 and
net earnings by $9.0 to $171.2. The impact of the synchronization on the prior year reported earnings per share
was a decrease of $.09 per share. All statement of earnings-related discussions comparing 2001 to 2000 below
refer to comparisons of current period results to synchronized 2000 results. Synchronization adjustments to
reported results for Ñscal 2000 are presented in the Note 22 to the Consolidated Financial Statements.
HIGHLIGHTS
Energizer recorded a net loss of $39.0 for the year ended September 30, 2001, compared to net earnings
of $181.4 in 2000. The loss per share was $.42, compared to earnings per basic share of $1.89 and per diluted
share of $1.88 in the prior year. Included in Ñscal 2000 results are earnings from continuing operations of
$180.2. Prior year net earnings include a net gain on disposition of discontinued operations of $1.2, or $.01 per
share, related to the Ñnal settlement of the sale of discontinued operations.
Net earnings were $80.0, or $.78 per share, for the year ended September 30, 1999. Included in 1999 net
earnings are earnings from continuing operations of $159.8, a net loss from discontinued operations of $5.6 and
a net loss on disposition of discontinued operations of $74.2.
Earnings from continuing operations decreased $210.2, or $2.21 and $2.20 per basic and diluted share,
respectively, in 2001. Current year earnings include a provision for goodwill impairment of $119.0, provisions
for restructuring of $29.8, or $19.4 after-tax, and income associated with the licensing of intellectual property
rights of $20.0, or $12.3 after-tax. Included in 2000 results were costs related to the spin-oÅ of $5.5 pre-tax, or
$3.3 after-tax, loss on disposition of Spanish aÇliate of $15.7, and capital loss tax beneÑts of $24.4. Excluding
these items, earnings from continuing operations decreased $78.7, or $.80 per share, in 2001. This decrease
was primarily attributable to lower operating results in the North America and Asia regions and higher tax
rate, partially oÅset by lower general corporate expenses and interest.
Earnings from continuing operations increased $20.4, or $.32 and $.31 per basic and diluted share,
respectively, in 2000. Included in 2000 results are the items listed in the previous paragraph. Fiscal 1999
results included provisions for restructuring of $9.9 pre-tax, or $8.3 after-tax, and capital loss tax beneÑts of
$16.6. Excluding these items, earnings from continuing operations increased $23.3, or $.35 and $.34 per basic
and diluted share, respectively, in 2000. This increase was primarily attributable to improved operating results
in North America and Asia PaciÑc and lower corporate overhead, partially oÅset by higher interest expense on
the debt assumed as part of the spin-oÅ from Ralston.
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