Energizer Holdings (NYSE: ENR) reported Q1 EPS of $1.64, $0.14 better than the analyst estimate of $1.50. Revenue for the quarter came in at $571.9 million versus the consensus estimate of $572.93 million.

"As we continued to focus on our strategic initiatives, we delivered strong operating results driven by organic top line growth and cost savings from our continuous improvement efforts,\" said Alan Hoskins, Chief Executive Officer. "These strong results will allow us to continue to invest in our business for long term growth while delivering $3.45 to $3.55 per adjusted diluted share on our base business, an increase over our previous outlook."

"During January, we closed on both of our acquisitions: Spectrum\'s battery and portable lighting business and the auto care business. We are very excited about the strategic, operational and financial opportunities of both of these businesses. This is truly a transformative time in Energizer\'s history as we become the global leader in the portable power and automotive care categories."

• Net sales were $571.9 million, a decrease of 0.2%: (a)
• Organic net sales increased $9.9 million, or 1.7%, due to category growth and distribution gains across both segments and the impact of the reclassification of licensing revenues, slightly offset by increased retailer promotion and unfavorable mix.
• The impact of the Nu Finish acquisition increased net sales by $1.0 million, or 0.2%;
• Our Argentina operations, deemed to be highly inflationary, had an unfavorable impact on net sales of $3.3 million, or 0.6%.
• Unfavorable movement in foreign currencies, excluding Argentina, resulted in decreased sales of $9.0 million, or 1.5%.
• Gross margin percentage was 48.2%, down 30 basis points from prior year driven by unfavorable movement in foreign currencies partially offset by lower production costs and the lapping of the investments made in continuous improvement initiatives in the prior year.
• A&P spending was 7.2% of net sales, an increase of 70 basis points, or $3.6 million, versus the prior year driven by the timing of media spending.
• SG&A spending, excluding acquisition and integration costs, as a percent of net sales was 15.0%, or $85.7 million, a decrease of $7.8 million versus the prior year driven by the benefit of our continuous improvement initiatives as well as lapping prior year investments in those initiatives. These benefits were partially offset by the licensing revenue reclassification to net sales. (a)
• Interest expense was $48.2 compared to $13.4 for the prior year comparative period. The current quarter expense included $32.4 of interest and ticking fees related to the Spectrum battery and portable lighting acquisition. Excluding the acquisition costs, the current year interest expense increased $2.4 driven by increased borrowings and increased rates on our variable debt outstanding. (a)
• Earnings before income tax was negatively impacted by the movement in foreign currencies by approximately $10 million, net of hedge impact. This includes $4 million from our Argentina operations.
• Income tax rate on a year to date basis was 21.3% as compared to 49.2% in the prior year. The current and prior year rate includes $1.5 million and $31.0 million respectively, for the one-time impact of the new U.S. tax legislation passed in December 2017. Excluding the impact of our Non-GAAP adjustments, the year to date tax rate was 20.8% as compared to 23.4% in the prior year. The decrease in the rate is driven by the new 21% statutory U.S. rate effective for all of fiscal year 2019 compared to the statutory rate of 24.5% in fiscal year 2018. (a)
• Diluted earnings per share for the quarter was $1.16 and Adjusted diluted earnings per share for the quarter was $1.64. (a)
• Net cash from operating activities on a year to date basis was $118.9 million and Adjusted free cash flow on a year to date basis was $150.9 million, or 26.4% of net sales. (a)
• Dividend payments in the quarter were approximately $19.8 million, or $0.30 per share.

GUIDANCE:

Energizer Holdings sees FY2019 EPS of $3.45-$3.55, versus the consensus of $3.38.

For earnings history and earnings-related data on Energizer Holdings (ENR) click here.