Rayovac 2003 Annual Report Download - page 9

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with $572.7 million in fiscal 2002. Diluted earnings per share was $0.48. However, adjusted
diluted earnings per share, excluding certain charges as detailed in Table 1 on page 12,
rose to $1.27.
We are currently applying the same proven management disciplines and principles that
we used in integrating Varta to our newest acquisition, Remington. We are driving sales
through our global distribution network and customer base, and we are creating new
efficiencies by integrating our supply chain, back-office operations, product development
and information systems functions. We expect these efforts to generate significant savings by
fiscal 2005, creating a more efficient and capable organization that will compete effectively
on a global scale.
Executing an Aggressive New Retail Strategy During the past year, we also focused
on addressing the challenges in our North American battery business. We responded
to increased promotional and pricing competition in the alkaline battery category by
launching an exciting new retail strategy aimed at reestablishing our value positioning
in the market.
This strategy, unique to the battery industry, offers “50% More” batteries in AA and AAA
sizes, at roughly the same retail price points as the smaller package sizes offered by major
competitors. Rayovac’s value proposition of “More Power for Your Money!” was well
received by North American retailers, who welcomed the new package configuration on
their shelves. To support the strategy, we launched a comprehensive marketing effort,
including a new targeted television campaign. Consumer reaction has been positive, and
we expect sales growth in our North American alkaline business in fiscal 2004.
Reaffirming Our Reputation for Innovation Rayovac has developed a reputation
as a technology leader by continually providing consumers with new or improved,
technologically advanced products to meet their portable power needs. In 1994, we
introduced rechargeable alkaline batteries to the U.S. market. In 2001, we launched the first
portable charger that charged high-capacity Nickel Metal Hydride (NiMH) batteries in one
hour or less. In the summer of 2003, we took speed charging to a higher level with the
introduction of the revolutionary new In-Cell Charge Control (I-C3) rechargeable NiMH
battery system of batteries and chargers. This breakthrough in NiMH technology offers
performance and convenience advantages over existing rechargeable and disposable battery
systems. An I-C3battery will charge in an unprecedented 15 minutes or less and up to 1,000
times. The battery also lasts up to four times longer than alkaline batteries in digital cameras.