Energizer (US:ENR) ZACKSยท2024-06-10 17:45Core Insights - Energizer is focusing on sustainable growth through operational efficiency, cost savings, and debt reduction, despite facing challenges in certain segments [12][15]. Financial Performance - The Auto Care segment has shown significant growth, with revenues increasing by 2.3% year over year to $182.3 million in Q2 of fiscal 2024, alongside a 600-basis-point expansion in segmental profit [2]. - The adjusted gross margin improved by 260 basis points to 40.5%, driven by Project Momentum and lower input costs [16]. - The Zacks Consensus Estimate for sales in the current and next quarters is $705.1 million and $817.9 million, respectively, indicating a year-over-year growth of 0.8% [5]. Cost-Saving Initiatives - Energizer anticipates total savings from its cost-saving program between $160 million and $180 million over three years, with expected savings of $55-$65 million for fiscal 2024 [1]. - Project Momentum has generated approximately $100 million in total savings, with $20 million achieved in Q2 of fiscal 2024 alone [8]. Debt Management - The company has implemented a robust debt reduction strategy, paying down $60 million in debt during the fiscal second quarter and reducing total debt by $425 million over the past seven quarters [3][17]. - Energizer's debt structure remains strong, with a weighted average cost of debt at 4.6% and no significant debt maturities until 2027 [17]. Segment Challenges - The Batteries & Lights segment faced challenges, with revenues decreasing by 4.9% year over year to $481 million in Q2, impacted by competitive pressures from private labels [4][10].