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Energizer Holdings Declares Dividend of ~$0.28 Per Share

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Price movement

In the third week of November 2016, Energizer Holdings (ENR) fell 4.0% to close at $42.51 per share. The stock’s weekly, monthly, and year-to-date (or YTD) price movements were -4.0%, -11.9%, and 27.0%, respectively, as of November 18.

ENR is trading 7.5% below its 20-day moving average, 9.3% below its 50-day moving average, and 6.6% below its 200-day moving average.

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Related ETF and peers

The Schwab US Mid-Cap ETF (SCHM) invests 0.13% of its holdings in Energizer. The YTD price movement of SCHM was 11.5% on November 18.

The market caps of Energizer Holdings’ competitors are as follows:

  • Spectrum Brands Holdings (SPB): $7.4 billion
  • HRG Group (HRG): $3.0 billion

Energizer declared dividend

Energizer Holdings has declared a quarterly dividend of ~$0.28 per share on its common stock. The dividend will be paid on December 15, 2016, to shareholders of record at the close of business on November 30, 2016.

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Performance of Energizer Holdings in fiscal 4Q16

Energizer Holdings reported fiscal 4Q16 net sales of $432.4 million, a rise of 8.3% compared to net sales of $399.1 million in fiscal 4Q15 due to its HandStands acquisition, partially offset by unfavorable foreign exchange. The company’s gross profit margin narrowed 260 basis points in fiscal 4Q16 compared to the prior year’s period.

Its net income and EPS (earnings per share) fell to $21.6 million and $0.34, respectively, in fiscal 4Q16 compared to $23.1 million and $0.37, respectively, in fiscal 4Q15. It reported adjusted EPS of $0.54 in fiscal 4Q16, a fall of 11.5% compared to fiscal 4Q15.

Fiscal 2016 results

In fiscal 2016, ENR reported net sales of $1.6 billion, a rise of 0.16% YoY (year-over-year). This rise in sales was due to the acquisition of HandStands and was partially offset by an unfavorable foreign exchange impact, deconsolidation of the Venezuela operations, and international go-to-market changes. The company’s gross profit margin narrowed 270 basis points in fiscal 2016.

ENR’s net income and EPS rose to $127.7 million and $2.04, respectively, in fiscal 2016 compared to -$4.0 million and -$0.06, respectively, in fiscal 2015. It reported adjusted EPS of $2.31 in fiscal 2016, a fall of 18.1% YoY.

Energizer’s cash and cash equivalents fell 42.8%, and its inventories rose 4.8% in fiscal 2016. Its current ratio fell to 1.7x in fiscal 2016 compared to 2.3x in fiscal 2015.

Projections

Energizer has made the following projections for fiscal 2017:

  • net sales growth in the mid-single digits
  • gross margin growth of 50–100 basis points due to productivity initiatives
  • income tax rate of 30.0%–31.0%
  • adjusted EPS of $2.55–$2.75, which includes $0.15–$0.20 from the HandStands acquisition
  • capital spending of $30.0 million–$35.0 million
  • free cash flow will exceed $180.0 million

In the next part, let’s look at Post Holdings (POST).

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