Energizer 2001 Annual Report Download - page 16

Net sales to customers increased $92.8, or 9%, in 2000 on higher volume, partially oÅset by unfavorable
pricing and product mix. Alkaline unit volume increased 11% over 1999. Strong Y2K-driven demand early in
the Ñscal year, and incremental Energizer e2 sales in the last four months of the year, accounted for the
increased volume. Gross margin increased $54.1, with volume contributing $45.8. In addition, favorable
production costs were partially oÅset by unfavorable pricing and product mix. Segment proÑt increased $20.5,
or 7%, as higher gross margin was partially oÅset by increased advertising and promotion expense, primarily
related to the Energizer e2 launch, as well as higher marketing and distribution expenses.
Asia PaciÑc
Net sales to customers decreased $47.9, or 13%, in 2001. Excluding currency devaluation of $30.3, net
sales decreased $17.6, or 6%, on lower volume reÖecting unfavorable economic conditions in the region.
Alkaline, carbon zinc and lighting products unit volume decreased 6%, 9% and 7%, respectively, from 2000.
Segment proÑt for Asia PaciÑc decreased $28.2, or 27%, in 2001 with unfavorable currency eÅects accounting
for $19.0 of the decline. Absent currencies, segment proÑt decreased $9.2, or 9%, on lower volume and higher
product cost, partially oÅset by lower advertising and promotion and overhead expenses.
Net sales to customers increased $8.7, or 2%, in 2000. Excluding currency devaluation of $4.3, net sales
increased $13.0, or 3%. Alkaline volume increases of 8% were partially oÅset by a 2% decline in carbon zinc
volume. Segment proÑt for Asia PaciÑc increased $22.7, or 25%, in 2000 on lower production costs, higher
customer sales and higher intersegment sales. Lower production costs reÖect a variety of factors including
higher production facility utilization and lower costs resulting from a plant closing in 1999.
Europe
Net sales to customers for Europe decreased $10.8, or 4%, in 2001, which included currency devaluation
of $24.2. Absent currency eÅect, sales increased $13.4, or 5%, on higher volume, partially oÅset by unfavorable
pricing and product mix in the Ñrst three quarters of the year. Alkaline unit volume increased 19% during 2001
while carbon zinc volume declined 9%. Much of the volume increase and unfavorable pricing was due to heavy
promotional activity early in the year. Segment results for Europe improved $1.6 for the year to a loss of $2.6
and included unfavorable currency eÅects of $13.4. Absent currencies, segment proÑt increased $15.0, with
higher sales, lower advertising and promotion expense, and lower product cost accounting for $8.7 of the
increase. In addition, prior year results included an unfavorable adjustment related to estimates for
promotional and rebate programs, as well as costs related to reorganization activities, improving the year over
year comparison by approximately $6.3.
Net sales to customers for Europe decreased $44.2, or 14%, in 2000 reÖecting currency devaluation of
$28.2, lower carbon zinc volume of $11.8, and unfavorable pricing and product mix of $6.9, partially oÅset by a
1% alkaline volume gain. For the year, carbon zinc unit volume declined 14%. Segment results for Europe
improved $1.0 to a loss of $.2. Net currency impacts in 2000 were unfavorable $6.8 compared to 1999. Absent
currency impacts, segment results improved $7.8, as lower sales were partially oÅset by lower product and
overhead costs. Lower costs reÖected increased eÇciencies following a plant closing and sales and administra-
tive realignment completed in 1999 and early 2000.
South and Central America
Net sales to customers increased $6.5, or 5%, in 2001 primarily on higher volume, partially oÅset by
currency devaluation. Alkaline volume increased 5% in 2001 while carbon zinc volume declined 2%. Segment
proÑt decreased $2.5, or 26%, virtually all on currency impacts. Higher sales volumes were oÅset by higher
product costs.
Net sales to customers decreased $8.1, or 6%, in 2000 primarily on lower volume and on currency
devaluation, which could not be mitigated through pricing actions. Carbon zinc volume declined 6% while
alkaline increased 1%. Despite the sales decrease, gross margin increased $.6, or 2%, as unfavorable currency
impacts of $7.2 were more than oÅset by lower production costs and favorable pricing and product mix.
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