In This Article:
-
Organic Net Sales: Slight increase in the fourth quarter; full year declined 2.2%.
-
Adjusted Gross Margin: Increased by 220 basis points to 42.2% in Q4; 40.9% for the full fiscal year.
-
Free Cash Flow: Nearly $340 million for the fiscal year; 17.9% of sales in Q4.
-
Debt Reduction: Paid down $200 million in fiscal 2024; net leverage ratio reduced to 4.9 times.
-
Adjusted Earnings Per Share: $3.32 for the fiscal year; $1.22 in Q4.
-
Adjusted EBITDA: $612.4 million for the fiscal year; $187.3 million in Q4.
-
Project Momentum Savings: Almost $90 million for the fiscal year; $25 million in Q4.
-
Interest Expense: Decreased by $3.8 million due to lower average debt and interest rates.
-
SG&A as a Percent of Sales: 15.3% in Q4, increased by $7.5 million.
-
Fiscal 2025 Outlook: 1% to 2% organic sales growth; adjusted EBITDA of $625 million to $645 million; adjusted EPS of $3.45 to $3.65.
Release Date: November 19, 2024
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
-
Energizer Holdings Inc (NYSE:ENR) achieved organic net sales within their originally guided range, supported by strong second-half momentum.
-
The company improved adjusted gross margins by 190 basis points, reaching 42.2% in the fourth quarter.
-
Energizer Holdings Inc (NYSE:ENR) generated free cash flow of nearly $340 million, allowing for a $200 million debt reduction.
-
The company is expanding its distribution footprint and accelerating growth in e-commerce, with a 15% increase in e-commerce sales in fiscal 2024.
-
Energizer Holdings Inc (NYSE:ENR) introduced innovative products, such as the Armor All Podium Series and the world's first three-in-one coin lithium Child Shield battery, enhancing their market position.
Negative Points
-
Organic net sales declined by 2.2% for the full year, primarily due to timing of holiday orders and planned pricing and promotional spend.
-
Adjusted SG&A expenses increased due to higher digital transformation costs, travel expenses, and wages.
-
The company faces headwinds from pricing, with a 100 basis point impact expected in fiscal 2025.
-
Energizer Holdings Inc (NYSE:ENR) continues to carry a high leverage ratio, ending fiscal 2024 with a net leverage ratio of 4.9 times.
-
The company anticipates foreign exchange headwinds, with a projected impact of 100 to 150 basis points on top-line growth in the first quarter of fiscal 2025.
Q & A Highlights
Q: Can you discuss the long-term trajectory for gross margins, given the structural changes made to the business? A: John Drabik, CFO, explained that after reaching pre-pandemic levels, they anticipate a 50 basis point increase in 2025, followed by more algorithmic growth of about 25 basis points annually. They have several programs beyond Project Momentum to support this growth.