Energizer 2008 Annual Report Download - page 2

FINANCIAL HIGHLIGHTS
Energizer Holdings, Inc. is a consumer goods company operating globally in the broad categories of household and personal care
products. The Household Products Division gives consumers the broadest range of portable power solutions, anchored by the universally
recognized Energizer® and Eveready® brands, plus specialty batteries, Energi To Go® chargers and a complete line of battery-powered
flashlights and lanterns.The Personal Care Division offers a diversified range of consumer products in the wet shave, skin care, feminine
care and infant care categories with well-established brand names such as Schick® and Wilkinson Sword® men’s and women’s shaving
systems and disposable razors; Playtex® tampons, gloves and infant feeding products; Banana Boat® and Hawaiian Tropic® sun care
products; and Wet Ones® moist wipes. With commercial and production operations in 49 countries and distribution in another 131
countries, the company markets its products throughout most of the world. Energizer is traded on the NYSE under the ticker symbol ENR.
In addition to its earnings presented in accordance with generally accepted accounting principles (GAAP), Energizer has presented certain non-GAAP measures in the table above
which it believes are useful to readers in addition to traditional GAAP measures. These measures should not be considered as an alternative to comparable GAAP measures.
(a) In 2008, earnings are presented with and without the impact of a write-up recorded on inventory acquired through the purchase of Playtex Products, Inc. GAAP requires
inventory to be valued at fair market value less the cost of disposal and a profit allowance for the selling effort, as opposed to its historical manufacturing cost. As a result, there
was a one-time allocation of purchase price to the acquired inventory which was $27.5 million, pre-tax, or $16.5 million, after tax, higher than historical manufacturing cost.
Because inventory value and cost of product sold for all product manufactured after the acquisition date are based upon actual production costs, as dictated by GAAP, Energizer
believes presenting earnings excluding the inventory write-up is useful to investors as an additional basis for comparison to prior and subsequent periods.
(b) Free cash flow is defined as net cash provided by operating activities net of additions to and disposals of property, plant and equipment. The Company views free cash flow as
an important indicator of its ability to repay debt, fund growth and return cash to shareholders. Free cash flow is not a measure of the residual cash flow that is available
for discretionary expenditures, since the Company has certain non-discretionary obligations, such as debt service, that are not deducted from the measure. For April 1, 2000
to September 30, 2008, cumulative cash flow and capital expenditures were $3.1 billion and ($0.8) billion, respectively. Cumulative free cash flow for the period April 1, 2000 to
September 30, 2008, was $2.3 billion.
Year Ended September 30, 2008 2007 2006 2005 2004
NET EARNINGS (in millions)
Net Earnings, excluding inventory write-up $ 345.8 $ 321.4 $ 260.9 $ 280.7 $ 261.0
Playtex inventory write-up, net of tax(a) (16.5)
Net Earnings $ 329.3 $ 321.4 $ 260.9 $ 280.7 $ 261.0
DILUTED EARNINGS PER SHARE
Net Earnings, excluding inventory write-up $ 5.87 $ 5.51 $ 4.14 $ 3.82 $ 3.13
Playtex inventory write-up, net of tax(a) (0.28)
Net Earnings $ 5.59 $ 5.51 $ 4.14 $ 3.82 $ 3.13
Diluted Weighted-Average Shares Outstanding 58.9 58.3 63.1 73.5 83.4
FREE CASH FLOW (in millions)(b)
Operating Cash Flow $466.5 $ 445.3 $ 373.0 $ 295.9 $ 479.3
Capital Expenditures (160.0) (88.6) (94.9) (103.0) (121.4)
Free Cash Flow $ 306.5 $ 356.7 $ 278.1 $ 192.9 $ 357.9
NET SALES
in billions
04 05 06 07 08
$2.81
$2.99
$3.08
$3.37
$4.33
EARNINGS PER SHARE
excluding inventory write-up
as noted above
04 05 06 07 08
$3.13
$3.82
$4.14
$5.51
$5.87