Boston, MA 04/30/2014 (wallstreetpr) – Energizer Holdings, Inc. (NYSE:ENR) is planning to split into two companies after years of operating as a single consumer products conglomerate mired with the buying of many brands. One of the companies after splitting will contain the company’s household products like Energizer and Eveready with the other one expected to house personal care offerings such as Schick razors and Hawaiian Tropic.
Split to Guarantee Proper Focus ON Brands
The latest move by Energizer Holdings, Inc. (NYSE:ENR) is a clear indication of how companies are trying to improve their shareholder value by disposing of off non-core assets and focusing on entities sure to guarantee better returns in the market. The split is also aimed at ensuring proper attention is given to the entities to ensure proper returns.
This marks the first evolution for Energizer Holdings, Inc. (NYSE:ENR) which became independent after being spun off by Ralston Purina 14 years ago. Since 2000, energizer has been able to build two successful divisions with each one of them realizing full potential as an independent entity. Energizer as a result of the split expects its household products to be well positioned to generate a significant amount of cash flow.
The separation will see Mr. Klein becoming the Chairman of the personal care company with David Hatfield taking over as the unit CEO. J Patrick Mulcahy is expected to take over as the household products company CEO with Alan Hoskins assuming the role of chief executive.
Q2 Earnings Up by 16.76%
Reports on a split come as the company reports a 16.3% increase in its earnings per share that came in at $1.57. The impressive results have already caused the company’s stock to surge in the market by highs of 16.76%. Net earnings for the quarter were in line with the company’s estimates. Cost optimization continues to provide the company with the much needed financial flexibility that is currently offsetting top line challenges.
Net sales for the quarter were down by 3.1% as a result of loss of two distribution retail customers in the U.S. Unfavorable foreign currency rates also continue to hurt the company’s cash balances. Gross margin for the quarter as a result, was down by 60 basis points to 47.8%.
