Energizer 2011 Annual Report Download - page 24

We may experience losses or be subject to increased funding and expenses related to our pension plans.
The funding obligations for Energizer's pension plans, including those assumed in the ASR acquisition, are impacted by the
performance of the financial markets, interest rates and governmental regulations. If the investment of plan assets does not
provide the expected long-term returns, interest rates change, or if governmental regulations change the timing or amounts of
required contributions to the plans, we could be required to make significant additional pension contributions which may have
an adverse impact on our liquidity, our ability to comply with debt covenants and may require recognition of increased expense
within our financial statements.
If Energizer fails to adequately protect its intellectual property rights, competitors may manufacture and market similar
products, which could adversely affect our market share and results of operations.
In fiscal 2011, the vast majority of our total revenues were from products bearing proprietary trademarks and brand names.
In addition, Energizer owns or licenses from third parties a considerable number of patents, patent applications and other
technology. Accordingly, Energizer relies on trademark, trade secret, patent and copyright laws to protect our intellectual
property rights. There is a risk that Energizer will not be able to obtain and perfect or maintain our own intellectual property
rights or, where appropriate, license intellectual property rights necessary to support new product introductions. In addition,
even if such rights are protected in the United States, the laws of some other countries in which Energizer's products are or may
be sold do not protect intellectual property rights to the same extent as the laws of the United States. We cannot be certain that
our intellectual property rights will not be invalidated, circumvented or challenged in the future, and Energizer could incur
significant costs in connection with legal actions relating to such rights. If other parties infringe our intellectual property rights,
they may dilute the value of our brands in the marketplace, which could diminish the value that consumers associate with our
brands and harm our sales.
We may not be able to continue to identify and complete strategic acquisitions and effectively integrate acquired companies
to achieve desired financial benefits.
We have completed four significant acquisitions since becoming an independent company in 2000, including, most recently,
the acquisition of ASR in fiscal 2011. We expect to continue making acquisitions if appropriate opportunities arise. However,
we may not be able to identify and successfully negotiate suitable strategic acquisitions, obtain financing for future acquisitions
on satisfactory terms or otherwise complete future acquisitions. Furthermore, our existing operations may encounter unforeseen
operating difficulties and may require significant financial and managerial resources, which would otherwise be available for
the ongoing development or expansion of our existing operations.
Even if we can complete future acquisitions, we face significant challenges in consolidating functions and effectively
integrating procedures, personnel, product lines, and operations in a timely and efficient manner. The integration process can be
complex and time consuming, may be disruptive to our existing and acquired business, and may cause an interruption of, or a
loss of momentum in, the business. Even if we can successfully complete the integration of acquired businesses into our
operations, there is no assurance that anticipated cost savings, synergies, or revenue enhancements will be realized within the
expected time frame, or at all.
The integration of Energizer's and ASR's businesses may not be successful or anticipated benefits from the acquisition may
not be realized.
The integration of the operations of the recently acquired ASR business with Energizer's business will continue to require a
significant amount of time and attention as well as financial resources. Furthermore, ASR offers private label products, a
product group in which we have limited experience.
Even if we are able to successfully combine the two business operations, it may not be possible to realize the full benefits of
the increased sales volume and other benefits that are currently expected to result from the acquisition, or realize these benefits
within the time frame that is currently expected. The benefits of the acquisition may also be offset by operating losses relating
to changes in commodity pricing, or in increased competition, or by risks and uncertainties relating to the combined company's
private label and branded products. If we fail to realize the benefits we anticipate from the acquisition, our results of operations
may be adversely affected.
Additional descriptions of risk factors impacting Energizer appearing under “ENERGIZER HOLDINGS, INC. -
MANAGEMENT'S DISCUSSION AND ANALYSIS OF RESULTS OF OPERATIONS AND FINANCIAL
CONDITION” are included in Exhibit 13 attached hereto, which will also appear in the Energizer Holdings, Inc. 2011
Annual Report to Shareholders.
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