Energizer personal care sales down on weak performance in North America
Group sales were $1.1bn, a fall of 1 percent, which was largely impacted by foreign currency translations in Latin America and the Asia Pacific region, while net earnings were $87.2m, compared to $70.2m in the corresponding quarter last year, a figure that was positively impacted by cost savings.
"We are pleased with the adjusted earnings per share growth of 33% for the third quarter," said Ward Klein, Chief Executive Officer for Energizer.
"We continue to make good progress on our restructuring efforts implementing many of the initiatives earlier than planned. As a result, we have revised our fiscal 2013 estimated gross savings from $50 to $60 million to more than $80 million.”
Big competition in the personal care segment
However, Klein also pointed out that the competitive state of the personal care market was largely to blame for weaker top line results, as he pointed to ‘elevated levels of competitive promotional activity’ in the segment.
As a result, personal care sales for the third quarter fell by 3.6 percent on a reported basis to $649.5m, with the company estimating that approximately half of this decline was attributable to negative foreign currency translations.
The company said that its performance in the personal care field was particularly hard hit by a lack of organic sales in the North America market, where it estimated that most of the categories it covers declined in value during the quarter.
Skin care sales down on 'wet weather'
On a product basis, the company said that sales of its Wet Shave brand fell by 1 percent on a reported basis, but were up 1 percent in organic terms, due to higher sales of disposable products.
The big hit came from skin care sales, which fell by 7 percent, both on a reported and organic basis, which the company blamed on unusually wet weather in North America impacting sales in the sun care category.
For the nine month period personal care sales fell by 1.7 percent, while net profit for the division also fell by 1.7 percent to $111.3m.
"As we look towards fiscal 2014, our key points of focus will include delivering our stated cost and working capital reduction objectives, restoring top line growth in Personal Care and investing in innovation and brand development activities to ensure the long-term health of the business," said Klein.
