Energizer 2015 Annual Report Download - page 4

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PLAYING TO WIN
Our mantra, “play to win,” describes our commitment to
fullling our mission. Energizer will win by leading with
innovation; operating with excellence; and continuing to drive
productivity gains.
Leading through innovation. Energizer has a long track record
of leading innovation in the battery category, including the
introduction of Energizer Max with PowerSeal Technology™
that provides protection from in-device leakage, and our lithium
batteries, which are the world’s longest lasting AA and AAA
batteries in high-tech devices. In 2015, we continued to
bring innovation to the category with the launch of Energizer
EcoAdvanced, our longest lasting alkaline battery and the
world’s rst battery made from 4 percent recycled batteries.
We also continued innovation in the lighting category in 2015
with our Fusion Light Technology line, which features advanced
optics technology to create a more uniform lighting experience.
Looking forward, we will continue to drive consumer centric
innovation in the battery and lighting categories.
Operating with excellence. I mentioned earlier my pride in our
team for superior work on the spinoff while continuing to
manage the business with excellence. As a smaller scale
company, we will win by “operating with excellence” across
all functions and geographies in everything we do … from
re-focusing our commercial footprint to winning in-store to
delivering best-in-class back-ofce services.
With our renewed focus on our core battery business, we have
streamlined our go-to-market strategies. Across many sub-scale
markets, we have transitioned from a direct sales model to a
distributor led model. This allows Energizer to reduce costs and
complexity by leveraging our distributor partnerships while
maintaining our strength across our major markets with a “direct
sales” presence. Our new go-to-market approach creates greater
agility, which allows us to react more quickly to evolving market
conditions and customer needs.
Driving productivity gains. As a household products
team, we’ve executed well on cost-saving initiatives and
reducing working capital … but we’re not done. We’re
continuing to explore cost-saving initiatives through ve new
productivity initiatives:
• Trade investment optimization. We’ve installed a dedicated
revenue management team to administer disciplined pricing
architecture and better analyze our trade investment dollars.
• SG&A improvement. Zero-based budgeting efforts allow us to
identify and analyze costs across the organization. Most
importantly, these efforts reinforce a cost-conscious mindset
and culture throughout the organization.
• Working capital improvement. Since 2011, we have
reduced our working capital requirements by nine percentage
points (as a percentage of net sales). This reduction was led
by signicant improvements in our days sales outstanding
and days payable outstanding. Looking forward, we believe
that we can continue to drive improvements, especially with
our days in inventory.
• Procurement savings. Our center-led team has been
instrumental in achieving both the restructuring savings
and the working capital reductions, and there are more
opportunities ahead.
• Integrated supply chain optimization. This includes
optimizing our end-to-end supply chain value stream,
manufacturing footprint and capacity utilization, while
enabling more innovation and speed-to-market for new
product development initiatives.
THE OUTLOOK FOR 2016
We will continue to experience a period of transition as we
progress through scal 2016 and begin our rst full year as a
stand-alone company. Our go-to-market changes and Venezuela
deconsolidation will impact our results through the rst half of
the year while currency headwinds are expected to persist
through much of the year. Despite these challenges, we believe
we have a winning strategy and game plan. Energizer has a
renewed focus and a clear mission. We will win by (1) growing
the top-line at a rate equal to or better than the category;
(2) continuing to strive to expand our margins; and (3) driving
productivity improvements … all in an effort to maximize free
cash ow. Our ability to generate top-tier free cash ow is what
sets us apart from our peers and provides the opportunities and
optionality that will enable us to win.
In closing, I would again like to sincerely thank our colleagues for
their hard work and investors for the condence they have shown
as we marked this milestone in the advancement of Energizer.
ENERGIZER HOLDINGS, INC. 2015 ANNUAL REPORT / PG. 2
ALAN R. HOSKINS
President and Chief Executive Ofcer,
Energizer Holdings, Inc.
November 20, 2015