Energizer 2004 Annual Report Download - page 5

ENR 2004 Annual Report 3
The strength of our operations emanates from our people and their focus on building the long-term
strength of our global brands. We compete for our fair share of shelf and fair share of the consumer’s
purchasing dollars by offering relevant product innovation that is effectively marketed in a manner that
builds our trading partners’ sales and profits. We feel this approach, combined with our small business
mindset and passion for results, will lead to continued significant growth in shareholder value.
WARD M. KLEI N, PRESIDENT AND CHIEF OPERATING OFFICER, ENERGIZER HOLDINGS, INC.
We invested heavily in our brands last year to ensure the long-term finan-
cial performance of our businesses in today’s highly competitive environ-
ment. In our shaving business, we dramatically expanded advertising and
promotions to generate consumer trial of our new shaving systems, while
in our battery business, we increased media advertising in support of our
premium brands while de-emphasizing discount promotions.
Late in the year, we restaged our Energizer
®
brand as part of an overarch-
ing integrated marketing campaign that brings back the Energizer Bunny
®
as the champion of tenacity and endurance.This $68 million “ Keep
Going™” initiative positions Energizer
®
as the battery that never quits for
people who never quit.
As part of our continuing effort to manage costs and reduce overhead,
we offered a Voluntary Enhanced Retirement Option, which was accepted
by 321 of our U.S. employees.This resulted in a significant charge in the
fourth quarter of 2004, but by not replacing many of the employees
accepting the offer, we expect to realize substantial cost savings that are
projected to offset program costs in less than two years.
Compatible Cultures
As complementary as our two business operations have proven to be, we
have discovered our two cultures to be equally compatible and mutually
collaborative.
Our collective management style is small-company oriented and participa-
tory by design, marked by more debate and less bureaucracy.We strive
for thoughtful speed to action. Further, we seek an ethical culture that
encourages management and colleagues alike to question if we are “ doing
the right thing” when making decisions or taking action.
Ensuring a Continutity of Leadership
It has been both an honor and my great pleasure to lead this company
since its spin off from the Ralston Purina Company in 2000.What I am
most proud of is assembing an outstanding leadership group, further
strengthened by the addition of the SWS management team.To ensure
continuity of leadership, we carefully manage our succession plan to place
talented, effective executives in key leadership positions.
Last January,Ward Klein was named president and chief operating officer
of Energizer Holdings with supervisory responsibility over both the com-
pany’s battery and shaving operations. He moved to Energizer from
Ralston Purina Company in 1986 and subsequently served capably in key
marketing and international positions. I am pleased to announce that the
Board of Directors has selected Ward to succeed me as chief executive
officer, effective upon my retirement on January 25, 2005.
As Ward assumes his new role, he will be ably supported by the leaders of
our two primary businesses – Joe McClanathan, who was appointed presi-
dent and chief executive officer of Energizer Battery worldwide, and Joe
Lynch, who remains president and chief executive officer of SWS worldwide.
These seasoned, highly successful executives, together with our proven
team of officers and senior managers, will keep this company going and
growing well into the future.
In Conclusion
We have world class brands, a quality management team and an outstand-
ing global distribution system. With these strengths, we will remain focused
on generating cash flow … and then investing that cash flow wisely.
Number of Market Value of
Shares Repurchased Shares Repurchased
Fiscal Year (in millions) (in millions) Per Share Price
2001 3.8 $ 79.6 $20.69
2002 3.8 $103.3 $27.29
2003 5.0 $131.4 $26.54
2004 13.4 $546.7 $40.94
Total 26.0 $861.0 $33.20
ENR Share Repurchase Summary
J. Patrick Mulcahy
Chief Executive Officer, Energizer Holdings, Inc.
November 15, 2004
* Net earnings and earnings per share for fiscal 2003 exclude the SWS inventory write-up as noted on
the inside front cover.