Energizer Holdings, Inc. · NYSE:ENR
Energizer — Investor Day (November 2019)
131 slides from Energizer's investor day presentation, Nov 21, 2019
Slide 1: 2019 Investor Day: Powerful Brands, Clear Vision
2019 INVESTOR DAY POWERFUL BRANDS CLEAR VISION November 21, 2019
Slide 2: Forward-Looking Statements
Forward-Looking Statements Energizer Holdings, Inc. (the “Company”) and its management may make certain statements that constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. These statements can be identified by the fact that they do not
Slide 3: Forward-Looking Statements
Forward-Looking Statements • The Company reports its financial results in accordance with accounting principles generally accepted in the U.S. (“GAAP”). However, management believes that certain non-GAAP financial measures provide users with additional meaningful comparisons to the corresponding his
Slide 4: Agenda
Agenda WELCOME Patrick Moore, Chairman ENERGIZER’S PATH FORWARD Alan Hoskins, Chief Executive Officer WINNING IN BATTERY AND AUTO Mark LaVigne, President and Chief Operating Officer CARE BUILDING BRAND LOVE AND Lori Shambro Terence Calloway MAKING THE IMPOSSIBLE POSSIBLE Chief Marketing Officer Chie
Slide 5: Energizer Holdings, Inc.
ENERGIZER HOLDINGS, INC. + PAT MOORE Independent Chairman of the Board ALAN HOSKINS Chief Executive Officer 5
Slide 6: Our path forward
Leverage significant capabilities to become the leading household Our path products company in forward… Batteries, Lights and Auto Care Integrated, category-centric operating model well-suited to drive organic growth and productivity improvements 6
Slide 7: Who we are
Who we are + PURPOSE FINANCIAL We’re leading the charge connecting OBJECTIVES brands, people and products to the world better than anyone else Maximize Free Cash Flow Solid Financial Foundation + MISSION Create Long-term Value Achieve industry leadership as a diversified, global household products c
Slide 8: Compelling value proposition
Compelling value proposition through ability to enhance leadership in Batteries and unlock potential in Auto Care Fiscal Year 2022 TARGETS Foundational Cornerstones Adjusted EBITDA STRONG PLATFORM FOCUSED STRATEGIES EXPERIENCED LEADERSHIP >$700M • Portfolio of leading iconic • Lead with innovation •
Slide 9: Powerful portfolio of leading brands
Powerful portfolio of leading brands A PORTFOLIO INCLUDING #1 OR #2 BRANDS THAT COMPETE ACROSS MANY CONSUMER SEGMENTS Source: Nielsen Global Track Complete, 12 Months Ending August 2019; Energizer or EVEREADY #1 or 2 Brands in across each of our tracked markets; Rayovac #1 global Value/Price brand;
Slide 10: Global footprint, scale and capabilities
Global footprint, scale and capabilities + Product Availability: + Consumer Reach: + Expertise: + BILLIONS WORLD 160 OF CLASS CONSUMERS GLOBAL SUPPLY MARKETS everyday CHAIN AND around the world in DISTRIBUTOR every consumer NETWORK channel 10
Slide 11: Proven operating expertise
Proven operating expertise Fiscal Year 2016 SINCE RESTRUCTURING STRONG CONTINUOUS 2013 IMPROVEMENT RESULTS $218M in annual run rate savings • Four consecutive years of organic revenue growth: +3.5% CAGR SEPARATION FROM EDGEWELL • Margin rate increased by 200 basis points 2015 Eliminated significant
Slide 12: Foundational core strategies
Foundational core strategies set the tone, direction, and success since separation, today and into the future Strategies are focused, purposeful and disciplined to deliver long-term value to customers, consumers, and shareholders 12
Slide 13: Team with rich industry knowledge and deep category experience
Team with rich industry knowledge and deep category experience Alan Hoskins Mark LaVigne Tim Gorman Greg Kinder Sue Drath Hannah Kim Chief Executive Officer President & Chief Operating Officer Chief Financial Officer Chief Supply Chain Officer Chief Human Capital Officer Chief Legal Officer Benjamin
Slide 14: Winning in Batteries and Auto Care
WINNING IN BATTERIES AND AUTO CARE + MARK LAVIGNE President & Chief Operating Officer 14
Slide 15: Strong track record of profitable growth since spinoff
Strong track record of profitable growth since spinoff Following the acquisitions, market leader in healthy categories benefitting from macro tailwinds Clear path to significant shareholder value creation 15
Slide 16: #2 share position with strong capabilities in declining category
#2 share position with strong capabilities in declining category Energizer at Spinoff in 2015 CORE CAPABILITIES • Brand building expertise Operating in a • Insight driven innovation • Global footprint with breadth of #2 position customers and channels in the battery category • Category management ex
Slide 17: Sound strategy, focused investments and discipline led to solid performance
Sound strategy, focused investments and discipline led to solid performance CAGR ‘16 to ‘18 +5% +13% +18% Net Sales Adjusted EBITDA Adjusted Free Cash Flow to $1.8B to $399M to $238M Top Tier among Household Peers Enhanced Market Position Significant distribution • Significant investment in brands a
Slide 18: Strategic acquisitions with potential to unlock additional value creation
Strategic acquisitions with potential to unlock additional value creation ACQUIRED ACQUIRED BATTERY/LIGHTS AUTO CARE Grew global category leadership and Established #1 U.S. share in attractive, unlocked operational efficiencies growing category • Strengthened position • Acquired #1 or #2 in battery
Slide 19: Acquired businesses need what worked in Batteries
Acquired businesses need what worked in Batteries Focus Investment in Brands DRIVES MARKET Executional LEADERSHIP Innovation Excellence AND VALUE Cost CREATION Improvement 19
Slide 20: Significant integration progress to date
Significant integration progress to date DELIVER: CREATE: EXECUTE: Business Results Value for the With a Disciplined Combined Business Approach • Stabilized Dayton operations • Expect >$100 million in • Near seamless transfer of synergies accounting systems with no • Integration proceeding with no c
Slide 21: Outsized financial returns through fiscal 2022
Outsized financial returns through fiscal 2022 $100M+ >$700M >$400M Synergies Adjusted EBITDA Adjusted Free Cash Flow 21
Slide 22: Attractive categories where brands matter
ATTRACTIVE CATEGORIES WHERE BRANDS MATTER + 22
Slide 23: Batteries are a large and growing category with a favorable outlook
Batteries are a large and growing category with a favorable outlook GLOBAL CATEGORY VALUE SALES $ Billion+ 6 Includes EHI measured markets Outlook for GLOBAL CATEGORY VOLUME category volume is + FLAT TO SLIGHTLY POSITIVE GROWTH 2016 2017 2018 2019 2020 2021 2022 2023 23 Source: Global Category Value
Slide 24: Battery volume globally is driven by three macro trends
Battery volume globally is driven by three macro trends DEVICES DEMOGRAPHICS DISASTERS U.S. Annual Volume per Buyer U.S. Volume Driven by Disasters 60 63 37 1.9% 1.1% 0.8% 0.4% 0.7% Getting Started (no Raising Families Retired (no child, age 2015 2016 2017 2018 2019 est. child, age <45) (children 0-
Slide 25: Broad and diverse device universe support continued socket creation
Broad and diverse device universe support continued socket creation NUMBER OF TOTAL BATTERY TOP BATTERY CONSUMPTION DEVICES POWERED DEVICES (billions) Remote control 6.5% 10.1 10.4 Clock 3.5% 9.7 9.5 9.2 Plastic flashlight 2.3% 9.0 8.9 8.9 8.9 8.9 9.0 Wireless mouse 2.3% Metal flashlight 2.2% 2012 2
Slide 26: Auto Care is a healthy and growing category with a favorable outlook
Auto Care is a healthy and growing category with a favorable outlook U.S. AUTO CARE CATEGORY SALES Outlook for category is + $ LOW SINGLE 2.9 DIGIT GROWTH Billion+ 26 Source: NPD U.S. National RTS+RTSx 52 Weeks Ending 10/5/19; Category Outlook: EHI custom analytics estimates
Slide 27: Energizer is engaged in four Auto Care subcategories
Energizer is engaged in four Auto Care subcategories Appearance Performance Refrigerants & Air Chemicals Chemicals Accessories Fresheners • Fuel & oil additives • A/C refrigerants • Vent • Interior & exterior • Paper cleaners • Brake fluid • Recharge kits $ B = • Tire care • Power-steering • Retrofi
Slide 28: Three macro trends drive the Auto Care category
Three macro trends drive the Auto Care category # OF CARS ANNUAL MILES DRIVEN AGE OF CAR Global Vehicle registrations Projected Global CAGR ‘20 – ‘22 US Average 7B Today % 11.8 years and Growing . and projected +2.0 Europe Average growth is Flat to low single digits 11.1 years and Growing Source: US
Slide 29: Other macro trends with potential to influence the category
Other macro trends with potential to influence the category ALTERNATIVES TO CAR SERVICE AS A CONNECTED CARS / OWNERSHIP BUSINESS / NEW NEW TECHNOLOGY & ELECTRIC VEHICLES (Ride-sharing, Self-driving cars) BUSINESS MODELS MATERIALS Tailwind Unclear Mixed by Subcategory Mixed by Subcategory 29
Slide 30: Executing unique capabilities to deliver significant shareholder value
Executing unique capabilities to deliver significant shareholder value Attractive Battery and Auto Care Categories Proven brand building capabilities Enhanced Innovation capabilities Global Commercial Capabilities Expertise in Manufacturing, Distribution and Supply Chain Extend global leadership in
Slide 31: Building brand love and making the impossible possible
BUILDING BRAND LOVE AND MAKING THE IMPOSSIBLE POSSIBLE + LORI SHAMBRO Chief Marketing Officer TERENCE CALLOWAY Chief Technology Officer 31
Slide 32: Consumer understanding, brand building, innovation expertise
Intimate understanding of consumers and shoppers Proven brand building ability Innovation expertise 32
Slide 33: Driving brand preference with consumers
Driving brand preference with consumers To be the first brands consumers… SEARCH SEE SELECT 1st brand that comes 1st brand consumers see The brand consumers to mind in-store or on-line prefer …regardless of the point of purchase 33
Slide 34: Delivering best in class brand building globally
Delivering best in class brand building globally THINK CONSUMERS BUILD BRAND UNLOCK THE FIRST LOVE VALUE Understand consumer journey Stand for something Data-driven and and anticipate their needs meaningful and be engaging consumer-led innovation 34
Slide 35: Innovation focused on making the impossible possible
Innovation focused on making the impossible possible + + + + ORGANIZATIONAL BALANCED OPEN INNOVATE R&D AN INNOVATION STRATEGIC APPROACH INNOVATION CAPABILITIES MINDSET ALIGNMENT TO INNOVATION ECOSYSTEM Assets & World is our Faster innovation Belief in the art of resources aligned laboratory cycle th
Slide 36: Better performance, lower cost, faster
Better Delivering Performance Lower-cost AND . . . Faster 36
Slide 37: Batteries: Still Going!
BATTERIES STILL GOING!® 37
Slide 38: Brands matter to battery consumers
Brands matter to battery consumers BRANDED PRODUCTS Premium brand batteries sell for DOMINATE SALES IN THE BATTERIES CATEGORY ~2x Private Label batteries 82% Private Label share has declined globally since 2009 GLOBAL BATTERIES Private Label Value Share 38 Source: Nielsen Global Track Complete; Annu
Slide 39: Engaging more consumers with leading brands
Engaging more consumers with leading brands Long-lasting Leaders Beloved Icon Broad Portfolio Maker of World’s Longest Lasting AA Battery Powerful Performance Value Price Made in the USA Premium Performance, Affordable Price Consistent Strong Heritage Iconic Character Quality & Value Trusted Value 3
Slide 40: Satisfying all consumer needs with the broadest product portfolio
Satisfying all consumer needs with the broadest product portfolio VALUE PERFORMANCE PRODUCTS PRODUCTS Carbon Zinc – Price Alkaline – Value Alkaline – Premium Alkaline – Rechargeable – Specialty – Lithium 40
Slide 41: In-depth consumer knowledge and investments drive brand strength
In-depth consumer knowledge and investments drive brand strength UNDERSTANDING THE CONSUMER Battery Consumer Segmentation Consumer Path-to-Purchase Brick & Mortar and On-line  Purchase Behavior Channel Preference Motivations On-line Actions Volumetric STRATEGICALLY INVESTING Advertisi
Slide 42: Consumers have a strong connection to our brands
As a result, Consumers # Battery brand on-line have a strong 1in the US Global Value connection to 32.4% Share of 96% Batteries our brands Brand Awareness ENERGIZER’S VALUE BRANDS Value # Rayovac and 1Brand 8.4% Eveready Global Value 76% Share of 54% Batteries Source: 1010data 12 Months Ending Augus
Slide 43: Great Today, Even Better Tomorrow
Great Today, Even Better Tomorrow 43
Slide 44: A history of world's firsts
A history of world’s firsts 1896 1956 1959 1991 1997 2011 2015 2018 9-volt Rechargeable Mercury- MAX Dry Cell Commercially Zero AA & AAA PLUS Battery Battery Viable Mercury NiMH Battery free Batteries Made Cylindrical Alkaline Cochlear With 4% Alkaline Battery Battery Battery Recycled Batteries Time
Slide 45: Battery Innovation
FORMULATION IMPROVED NEW MATERIALS ENHANCEMENTS CONSTRUCTIONS AND DESIGNS Battery Innovation + + 45
Slide 46: Positioned to deliver the best performing product tomorrow
Positioned to deliver the best performing product tomorrow 2030 RUN TIME IMPROVEMENT 2016 46
Slide 47: Rayovac provides enhanced innovation capabilities
RAYOVAC provides enhanced innovation capabilities EXPANDED PRODUCT, PERFORMANCE, PATENT PORTFOLIO AND OPPORTUNITY FOR SIGNIFICANT VALUE CREATION EXPECT $8M ~ OF SYNERGIES THROUGH VALUE ENGINEERING 47
Slide 48: #1 global position in Batteries
#1 global position in Batteries # Global # 1Battery 1Rechargeable Company # # Growing 1Lithium 1 Segment of Specialty Batteries # # Value eCommerce 1 1 Portfolio 48 Source: Nielsen Global Track Complete, 12 Months Ending August 2019; eCommerce U.S. 1010data 12 Months Ending September 2019
Slide 49: Auto Care: Leading Brands; Driving for Growth
AUTO CARE LEADING BRANDS; DRIVING FOR GROWTH 49
Slide 50: Brands matter to auto care consumers
Brands matter to auto care consumers % In Auto Appearance, Consumers are Brands Account for 91 of Auto Care Value Sales in the U.S. 2X more brand loyal to 9% national brands A Majority of Consumers Say Brand Matters in Auto Appearance, Fragrance and 91% Performance Chemicals Brands Private Label 50
Slide 51: Consumers engage in both DIY and DIFM
Consumers engage in both do-it-yourself (DIY) and do-it-for-me (DIFM) DIY AND DIFM HAVE HEALTHY GROWTH RATES DIY DIFM CONSUMERS WHO DO IT CONSUMERS WHO RELY ON THEMSELVES PROFESSIONALS DIFM 80% PROFILE PROFILE +4.4% • Younger • Older CAGR • Lower Middle Income • Middle Income • Older vehicle & high
Slide 52: Auto Care consumers seek products that elicit a sense of pride
Auto Care consumers seek products that elicit a sense of pride About For their friends For their themselves & families customers Their car is a personal reflection… Low Engagement High Engagement Just the Everyday Emerging Enthusiasts Basics Clean Enthusiasts with Barriers Enthusiast 52
Slide 53: Broad portfolio covers auto care bumper to bumper, inside and out
Broad portfolio covers auto care bumper to bumper, inside and out Internal Protectant Leather Carpet External Wash Wax Fragrance Wheel Tire Paint Restorati Trim Care Bug/Tar Remo Multi-Purpose Glass Cleaner Under the Hood Protectant Additives Lens/Plastic Functional fluids & Chrome/Metal treatments
Slide 54: Investing in brands and innovation to grow
Investing in brands and innovation to grow AUTO CARE A&P INVESTMENT ~2x DOUBLING* INCREASING QUANTITY ENHANCED PRESENCE OF INNOVATION IN-STORE & ON-LINE Pre-Acquisition With Energizer 54 *In approximately 18 months
Slide 55: Targeted marketing drives value for consumers and customers
Targeted marketing drives value for consumers and customers PRODUCT STRATEGY COMMUNICATION STRATEGY  Leader in Wipes Relevant Extensions Platform Innovation YouTube channel with How-To Videos PROMOTION STRATEGY PRICE SEGMENT STRATEGY Channel Authentic partnerships Right brand and right prod
Slide 56: Flagship brands lead in brand strength
Flagship brands lead in brand strength ARMOR ALL® SURPASSES STP OUTPERFORMS APPEARANCE CATEGORY BRANDS COMPETITORS Armor All Brand A Brand B STP Brand C Brand D 94 92 88 69 54 50 44 38 30 26 22 21 16 13 13 10 9 5 Awareness High Purchase First Choice Awareness High Purchase First Choice Consideration
Slide 57: Best in class performance, easy and intuitive to use
Best In Class Performance Easy & Intuitive to Use 57
Slide 58: Investing to accelerate and enhance Auto Care innovation
Investing to accelerate and enhance Auto Care innovation + • ORGANIZATIONAL Increasing R&D investment as a percent of net sales STRATEGIC ALIGNMENT • Doubling the organization BALANCED APPROACH • Extended roadmap from 1 to 5 years in each sub-category TO INNOVATION • Dedicated resources for innovati
Slide 59: Armor All headlight restoration wipes
Armor All® headlight restoration wipes INNOVATION — INSIGHT CREATING VALUE BETTER & FASTER Headlight Kit Value Sales Growth 32.5 1.3 31.7 0.6 0.7 1.2 0.6 59 Source: NPD U.S. National RTS + RTSx, 52 Weeks Ending 8-31-19
Slide 60: Armor All SmokeX
Armor All® SmokeX INSIGHT INNOVATION 60
Slide 61: STP PRO-Series Intake Valve Cleaner
STP® PRO-Series Intake Valve Cleaner INSIGHT INNOVATION 61
Slide 62: #1 with a leading portfolio of Auto Care brands
#1 with a leading portfolio of Auto Care brands VALUE SHARE OF U.S. AUTO CARE Appearance # 26.8 Chemicals 1 Value Share Energizer 20.7 Private Label 9.0 Refrigerants # 60.7 1 Value Share Lucas Oil 7.3 Fragrance # 21.2 2 Value Share Meguiar’s 6.8 Performance # in Fuel & Oil Car Freshner 5.8 Additives
Slide 63: Consumer understanding, brand building, innovation expertise
Intimate understanding of consumers and shoppers Proven brand building ability Innovation expertise 63
Slide 64: Building partnerships and executing with excellence
BUILDING PARTNERSHIPS AND EXECUTING WITH EXCELLENCE + MIKE LAMPMAN Chief Business Officer, Americas ROBIN VAUTH Chief Business Officer, International 64
Slide 65: Commercial overview: Americas and International
Commercial overview — Americas and International NET SALES BY CATEGORY Americas International $1.73B $0.76B $0.72B $1.36B $0.66B Net Sales ($B) 1.73 0.76 $1.09B $0.37B # Markets sold in $0.04B 47 115 0% 50% 100% Americas International (All Categories) (All Categories) Americas International Legacy A
Slide 66: Strong commercial capabilities with a track record of delivering results
Strong commercial capabilities with a track record of delivering results Organized to drive Focus on operational excellence Maximizing with efficiency Cash Flows Global footprint poised to accelerate growth 66
Slide 67: Be the preferred partner with customers through executional excellence
Be the PREFERRED PARTNER with customers through EXECUTIONAL EXCELLENCE 67
Slide 68: Strong commercial capabilities drive success
Strong commercial capabilities drive success OPERATIONAL + CATEGORY + REVENUE + DISTRIBUTION EXCELLENCE MANAGEMENT MANAGEMENT 68
Slide 69: Strong commercial capabilities drive success: operational excellence
Strong commercial capabilities drive success OPERATIONAL EXCELLENCE Best in class, shipments — on-time and in full Leader in weather responsiveness Execution in-store and on-line 69
Slide 70: Strong commercial capabilities drive success
Strong commercial capabilities drive success OPERATIONAL + CATEGORY EXCELLENCE MANAGEMENT Best in class, shipments Category & Shopper — on-time and in full Insights Leader in weather Shopper Based Solutions responsiveness Customer Partnership & Execution in-store and Planning on-line Category Captai
Slide 71: Strong commercial capabilities drive success
Strong commercial capabilities drive success OPERATIONAL + CATEGORY + REVENUE EXCELLENCE MANAGEMENT MANAGEMENT Best in class, shipments Category & Shopper Tools & Technology — on-time and in full Insights Data & Pricing Analytics Leader in weather Shopper Based Solutions responsiveness Mix Managemen
Slide 72: Strong commercial capabilities drive success
Strong commercial capabilities drive success OPERATIONAL + CATEGORY + REVENUE + DISTRIBUTION EXCELLENCE MANAGEMENT MANAGEMENT Best in class, shipments Category & Shopper Tools & Technology Geographies & Channels — on-time and in full Insights Data & Pricing Analytics Total Store Approach Leader in w
Slide 73: Strong commercial capabilities drive success: distribution
Strong commercial capabilities drive success DISTRIBUTION Geographies & Channels Total Store Approach Leverage our brand portfolio and innovation 73
Slide 74: Strong commercial capabilities drive success: distribution
Strong commercial capabilities drive success DISTRIBUTION Geographies & Channels Total Store Approach Leverage our brand portfolio and innovation 74
Slide 75: Strong commercial capabilities drive success: distribution
Strong commercial capabilities drive success DISTRIBUTION Geographies & Channels Total Store Approach Leverage our brand portfolio and innovation 75
Slide 76: Strong commercial capabilities drive success: distribution
Strong commercial capabilities drive success DISTRIBUTION Geographies & Channels Total Store Approach Leverage our brand portfolio and innovation 76
Slide 77: Strong commercial capabilities drive success: eCommerce value share
Strong commercial capabilities drive success EHI eCommerce Value Share vs. YAG — Batteries DISTRIBUTION Generating Growth Geographies & Channels +13.4 Internationally Total Store Approach Share points Leverage our brand portfolio and innovation Amazon.co.UK Amazon.France Q2 Q4 FY15 FY19 77 1010 data
Slide 78: Strong commercial capabilities drive success
Strong commercial capabilities drive success OPERATIONAL + CATEGORY + REVENUE + DISTRIBUTION EXCELLENCE MANAGEMENT MANAGEMENT Best in class, shipments Category & Shopper Tools & Technology Geographies & Channels — on-time and in full Insights Data & Pricing Analytics Total Store Approach Leader in w
Slide 79: Commercial team is organized for the unique dynamics of the market
Commercial team is organized for the unique dynamics of the market CREATING OPERATIONAL EXCELLENCE WITH EFFICIENCIES AROUND THE GLOBE Modern Markets Developing Markets Distributor Markets clustered by Enables highest level Maximum efficiency & Markets commercial of standardization and effectiveness
Slide 80: Three market types combine geographies with similar characteristics
Three market types combine geographies with similar characteristics CREATING A SCALABLE APPROACH THAT IS EFFECTIVE AND EFFICIENT MODERN Market • Low GDP growth Context • High GDP per capita • High retail concentration Retail Context • Emerging eCommerce • Sophisticated category and Capabilities reve
Slide 81: Three market types combine geographies with similar characteristics
Three market types combine geographies with similar characteristics CREATING A SCALABLE APPROACH THAT IS EFFECTIVE AND EFFICIENT MODERN DEVELOPING Market • Low GDP growth • High GDP growth Context • High GDP per capita • Low GDP per capita • High retail concentration Retail Context • Large universe
Slide 82: Three market types combine geographies with similar characteristics
Three market types combine geographies with similar characteristics CREATING A SCALABLE APPROACH THAT IS EFFECTIVE AND EFFICIENT MODERN DEVELOPING DISTRIBUTOR Market • Low GDP growth • High GDP growth • Mixed Context • High GDP per capita • Low GDP per capita • High retail concentration Retail Conte
Slide 83: We are well positioned to create value in the future
We are well positioned TO CREATE VALUE in the future 83
Slide 84: Batteries acquisition enhances the portfolio and ability to grow
Batteries acquisition enhances the portfolio and ability to grow #1 GLOBAL + EXPANDED + GEOGRAPHIC + ENHANCED BATTERY COMPANY BRAND PORTFOLIO STRENGTH INNOVATION Global footprint Brands that resonate Footprint to reach more Expanded capabilities to creating economic with all consumer markets, channe
Slide 85: Auto Care provides a significant opportunity for growth
Auto Care provides a significant opportunity for growth STRATEGIC + INCREASED + PLATFORM + GREATER + BRAND & PRIORITY INVESTMENT FOR GROWTH PRESENCE PORTFOLIO Executive team A&P Centralized Draft off #1 or #2 Expand our brands priority support to increase position in and portfolio to Insights effici
Slide 86: Our commercial platform is poised to deliver solid growth
Our commercial platform is poised to deliver solid growth FY’20 NET SALES CHG. % % VS. YAG 1 – 2 3.5 Batteries Auto Care BEYOND FY’20 2x Grow faster than Auto Care net sales the category growth outside of North America 86
Slide 87: Strong commercial capabilities with a track record of delivering results
Strong commercial capabilities with a track record of delivering results Organized to drive Focus on operational excellence Maximizing with efficiency Cash Flows Global footprint poised to accelerate growth 87
Slide 88: Integrated supply chain optimization to drive productivity
INTEGRATED SUPPLY CHAIN OPTIMIZATION TO DRIVE PRODUCTIVITY + GREG KINDER Executive Vice President, Chief Supply Chain Officer TOM BENDL Vice President, Operations 88
Slide 89: Proven track record of driving productivity
Proven track record of driving productivity Dayton facility stabilization and improvement On track to deliver in excess of $100 million in synergies 89
Slide 90: Proven track record of driving productivity
Proven track record of driving productivity 2013 RESTRUCTURING TRACK RECORD OF STRONG (through 3/31/15, by category) EXECUTION EVENT RESULT 16% Integration Fiscal 2013 $218M run rate Multi-year savings experience restructuring supports 18% program 66% expectations for Fiscal 2015 Fully offset succes
Slide 91: Focus and discipline led to dramatic improvements in productivity
Focus and discipline led to dramatic improvements in productivity OPERATIONS PRODUCTIVITY FIXED OVERHEAD SPENDING Units / Energizer Operations Colleague s 2.0 $160 1.8 Millions $140 Million 1.6 $120 1.4 $100 1.2 1.0 $80 0.8 $60 0.6 $40 0.4 $20 0.2 $- 0.0 FY12 FY13 FY14 FY15 FY16 FY17 FY18 9 FY1 FY12
Slide 92: Dayton, Ohio Auto Care facility stabilized and performing well
Dayton, Ohio Auto Care facility stabilized and performing well FILL RATES PRODUCTIVITY Percentage Dollars / Unit 99% 2017 2019 % 98 needed to meet customer needs 85% 2017 2019 Direct Labor Variable Expense Fixed Cost Total Fill Rate Increased Dollars per Unit Down 14 percentage points 11% 92
Slide 93: Focused on creating a network that is fast, responsive and flexible
Focused on creating a network that is fast, responsive and flexible to help capitalize on opportunities Global network and grow the top line optimization Long and successful track record of driving productivity through network consolidation and optimization 93
Slide 94: Network optimization is a core competency
Network optimization is a core competency Proven Track Record 2011 2016 2018 2019 Round Cell 14 10 7 10 Specialty 2 1 1 3 NA Packaging 7 5 4 5 and Distribution Lights 2 1 1 1 Auto Care 2 1 3 Number of 25 19 14 22 Sites 94
Slide 95: Current global network has opportunities for optimization
Current global network has opportunities for optimization 22 LOCATIONS NA Packaging Round Cell Specialty Lights Auto Care and Distribution 95
Slide 96: Acquired global battery manufacturing
Acquired global battery manufacturing Fennimore, WI 22 Guatemala City, Guatemala LOCATIONS Recife, Brazil NA Packaging Round Cell Specialty Lights Auto Care and Distribution 96
Slide 97: Acquired global specialty battery manufacturing
Acquired global specialty battery manufacturing Washington, UK 22 LOCATIONS Portage, WI NA Packaging Round Cell Specialty Lights Auto Care and Distribution 97
Slide 98: North America battery packaging and distribution facility
North America battery packaging and distribution facility 22 Dixon, IL LOCATIONS NA Packaging Round Cell Specialty Lights Auto Care and Distribution 98
Slide 99: Acquired global Auto Care manufacturing
Acquired global Auto Care manufacturing Rassau, UK 22 LOCATIONS Dayton, OH NA Packaging Round Cell Specialty Lights Auto Care and Distribution 99
Slide 100: Balanced scorecard approach aligns with business objectives
Balanced scorecard approach aligns with business objectives FINANCIAL CRITERIA NON-FINANCIAL CRITERIA Cost and Working Manufacturing Speed Flexibility Risk return capital What are the What is the What are the What is the What flex What is our total delivered impact on plant’s impact on capacity will
Slide 101: Network changes recently announced to better meet customer needs
Network changes recently announced to better meet customer needs Establish North Relocate Watch and Consolidate NA America Distribution Electronic Packaging and Hub in Monroe, OH manufacturing assets Distribution facility in to Portage, WI Franklin, IN 18 Centralize key Auto manufacturing assets Clo
Slide 102: Several mechanisms are in place to de-risk the network design program
Several mechanisms are in place to de-risk the network design program GOVERNANCE + SEQUENCING + CHANGE + LABOR MANAGEMENT CONTINGENCIES Dedicated and experienced Sequence milestones for Ensure demand is level Avoid service disruption program leadership interdependencies and loaded on the organizatio
Slide 103: Proven capabilities and sound plan to deliver synergy target
Proven capabilities and sound plan to deliver synergy target SYNERGIES SYNERGIES WILL BE DRIVEN BY: (by category) 3% + + Supply Chain Engineering Simplification Improvements 38% $ Organizational 100M+ + Design 59% Manufacturing of cost savings Procurement Efficiency ~80% of expected synergies COGS S
Slide 104: Proven track record of driving productivity
Proven track record of driving productivity Dayton facility stabilization and improvement On track to deliver in excess of $100 million in synergies 104
Slide 105: Plan for success: financial discipline
PLAN FOR SUCCESS —FINANCIAL DISCIPLINE + TIM GORMAN Executive Vice President, Chief Financial Officer JOHN DRABIK Senior Vice President, Controller 105
Slide 106: Focus on maximizing free cash flow generation to support strategic priorities
Focus on maximizing free cash flow generation to support strategic priorities Balanced approach to capital allocation centered Focus on on reinvestment and Maximizing Cash Flows debt reduction Financial discipline for a global business 106
Slide 107: Proven track record of execution delivered strong financial results
Proven track record of execution delivered strong financial results NET SALES GROWTH ADJUSTED GROSS MARGIN EXPANSION 5% CAGR +200 bps $1,798 46.3% 46.2% $1,756 $1,634 44.3% FY 2016 FY 2017 FY 2018 FY 2016 FY 2017 FY 2018 ADJUSTED FREE CASH FLOW GROWTH ADJUSTED EBITDA GROWTH THROUGH STRONG PERFORMANC
Slide 108: Value creation algorithm: financial targets for FY 2022
Value creation algorithm – financial targets for FY 2022 TOPLINE + ADJUSTED + ADJUSTED + ADJUSTED + WORKING GROW AHEAD GROSS SG&A EBITDA CAPITAL OF THE MARGINS % OF SALES MID-TEENS % OF SALES CATEGORY 40 – 140 BPS GROWTH IMPROVE DELIVER + ~250 BPS (CUMULATIVE) IMPROVEMENT CAGR VALUE Deliver growth D
Slide 109: Expect net sales growth to outpace future category growth
Expect net sales growth to outpace future category growth CORE CAPABILITIES FOR GROWTH DRIVERS • Category growth – Battery 1% to 2% – Auto Care 2+% • Distribution gains LOW SINGLE • Revenue management DIGIT ORGANIC $2.7B GROWTH FY 2019 Pro Forma FY 2022 TOPLINE + ADJUSTED GROSS + ADJUSTED SG&A + ADJ
Slide 110: Organic growth and synergies expected to drive gross margin expansion
Organic growth and synergies expected to drive gross margin expansion HEALTHY GROWTH IN ADJUSTED DRIVERS FOR GROSS MARGIN RATE GROSS MARGIN (as percent of sales) EXPANSION • FY 2020 margins negatively impacted by over 100 bps: + ~250 – Stronger U.S. dollar BPS – Trade tariffs +110 to +140 BPS – Esti
Slide 111: Integration plan expected to deliver over $100 million in savings
Integration plan expected to deliver over $100 million in savings FY 2019 $18M $100M+ + FY 2020 $45 – $50M in synergies + FY 2021 $32 – $37M Reinvest synergy savings above $100M in the business and brands TOPLINE + ADJUSTED GROSS + ADJUSTED SG&A + ADJUSTED EBITDA + WORKING CAPITAL MARGINS % OF SALES
Slide 112: Investments to increase brand preference and drive conversion
Investments to increase brand preference and drive conversion FUTURE 6.0% – 6.25% BRANDS MATTER INVESTMENTS TO FY 2020 >$30M incremental spending potential BUILD BRAND % % EQUITY AND 5.0 – 5.5 AWARENESS % of net sales 112
Slide 113: Organic growth and acquisitions drive strong EBITDA growth
Organic growth and contributions from the acquisitions drive strong EBITDA growth FACTORS FOR EBITDA GROWTH PATH TO >$700 OF ADJUSTED EBITDA OUTLOOK $ • Acquired businesses create opportunity $100 50 – 70 >$700 to accelerate growth $160 $400 • Integration expected to deliver synergies ahead of plan
Slide 114: The primary focus is maximizing free cash flow
The primary focus is maximizing free cash flow STRONG FREE CASH FLOW NET ADJUSTED FREE CASH FLOW ENABLES $40 – 55 >$400M $ Reinvest in the business and brands $ 20 – 25 > 80 $16 $238M Pay down debt for a healthy Balance Sheet Return of Capital through a meaningful dividend & share repurchases to off
Slide 115: Financial discipline through a balanced approach to capital
Financial discipline through a balanced approach to capital PILLARS FOR SUCCESS DELIVER VALUE Selective, Relentless focus on Reinvest in Return of delivering value to Disciplined The Business Capital shareholders, M&A customers and consumers MAXIMIZE FREE Foundation CASH FLOW 115
Slide 116: Uses of free cash flow for future growth and return cash to shareholders
Uses of free cash flow for future growth and return cash to shareholders $ 924M Cash from Continuing Operations CAPITAL ALLOCATION FY 2015 – FY 2019 $ $174M $206M (Actuals) 300M Note: Sourced from Form 10-K Dividends Paid Capital Spending Share Repurchases 4 $3.3B Acquisitions 116 Capital Spending s
Slide 117: Debt reduction is a priority for capital allocation
Debt reduction is a priority for capital allocation PILLARS FOR SUCCESS DELIVER VALUE Reinvest Healthy Selective, Relentless focus on Return of delivering value to in The Balance Disciplined Capital shareholders, Business Sheet M&A customers and consumers MAXIMIZE FREE Foundation CASH FLOW 117
Slide 118: Return leverage to pre-acquisition levels
Return leverage to pre-acquisition levels by fiscal year 2022 NET DEBT TO ADJUSTED EBITDA SUMMARY CAPITALIZATION ($M) As of 9/30/19 Cash (minimum) $259 5.2x 4.7x 4.2 – 4.4X Total Debt $3,495 3.3x – 3.5x 3.1x Availability under $370 $400M Revolver • Use strong free cash flow generation to reduce debt
Slide 119: Class-leading free cash flow
Class-leading free cash flow ADJUSTED FREE CASH FLOW / ADJUSTED ADJUSTED FREE CASH FLOW YIELD NET INCOME 13.5% 138.6% 118.6% 120.6% Median=95.4% 91.0% 95.1% 95.7% 7.8% Median=5.0% 5.9% 6.0% 56.8% 3.9% 3.9% 4.1% 46.4% 3.1% Peer 4 Peer 7 Peer 1 Peer 5 Peer 2 Peer 3 ENR Peer 6 Peer 7 Peer 6 Peer 4 Peer
Slide 120: Strategic plan creates the potential for significant shareholder returns
Strategic plan creates the potential for significant shareholder returns Base EPS Growth 2% to 3% + 15% to Synergies 8% to 10% 20% + Debt Repayment 3% to 4% annualized + shareholder return through 2022 Dividend Yield 2% to 3% FY 2022 Targets Adjusted EBITDA > $700M Adjusted FCF > $400M 120
Slide 121: Energizer's path forward
ENERGIZER’S PATH FORWARD + ALAN HOSKINS Chief Executive Officer 121
Slide 122: Compelling value proposition
Compelling value proposition Foundational Cornerstones Fiscal Year 2022 15% to TARGETS STRONG PLATFORM Adjusted EBITDA 20% >$700M FOCUSED STRATEGIES annualized Adjusted FCF shareholder return >$400M EXPERIENCED LEADERSHIP through 2022 Company + Relentless + Customer & + Passionate Identity focus to
Slide 123: Appendix
ENERGIZER INVESTOR DAY + Appendix 123
Slide 124: Energizer management team – presenters
Energizer management team – presenters Patrick Moore, Chairman of the Board President and Chief Executive Officer, PJM Advisors, LLC Board Member Since: 2015 Pat is Chairman of Energizer’s Board of Directors and President and Chief Executive Officer of PJM Advisors, LLC. Prior to PJM, Pat served as
Slide 125: Energizer management team – presenters
Energizer management team – presenters Mike Lampman, Chief Business Officer, Americas Joined Energizer: 1986 Prior to his current role, Mike was Vice President, Commercial Strategy for the Americas. He has also served as Vice President, Trade Marketing for North America as well as in a number of sal
Slide 126: Energizer management team – attendees
Energizer management team – attendees Ruben Mella, Vice President, Communications Joined Energizer: 2019 Ruben was recently appointed as Vice President of Communications at Energizer. Ruben led investor relations at Anheuser-Busch Companies, Inc., Monsanto Company, Inc. and Aegion Corporation. Addit
Slide 127: Energizer management team – attendees
Energizer management team – attendees Michelle Atkinson, Chief Growth Officer Joined Energizer: 2000 Prior to her current role, she served as Vice President, North America Marketing and Vice President, Strategic Planning and Brand Development, Chief Consumer Officer, and Chief Strategy Officer. Mich
Slide 128: Non-GAAP reconciliation: adjusted EBITDA
Non-GAAP reconciliation: adjusted EBITDA (Amounts in Millions) FY2016 FY2017 FY2018 Net Earnings $ 128 $ 202 $ 94 Income tax provision 38 72 82 Earnings before taxes $ 166 $ 273 $ 175 Interest expense 54 53 98 Depreciation and Amortization 34 50 45 EBITDA $ 254 $ 377 $ 319 Restructuring 5 —Spin Cost
Slide 129: Non-GAAP reconciliation: adjusted free cash flow
Non-GAAP reconciliation: adjusted free cash flow (Amounts in Millions) FY2016 FY2017 FY2018 Net cash from operating activities $ 194 $ 197 $ 229 Capital expenditures (29) (25) (24) Proceeds from sale of assets 2 27 6 Free cash flow—subtotal $ 167 $ 199 $ 211 Acquisition and integration related payme
Slide 130: Non-GAAP reconciliation: adjusted gross margin
Non-GAAP reconciliation: adjusted gross margin For the year ended September 30, (Amounts in Millions) 2016 2017 2018 Sales $ 1,634.2 $ 1,755.7 $ 1,797.7 Reported Cost of products sold 921.8 944.4 966.8 Reported Gross Profit $ 712.4 $ 811.3 $ 830.9 Reported Gross Margin 43.6% 46.2% 46.2% Restructurin
Slide 131: Non-GAAP reconciliation: net sales reconciliation
Non-GAAP reconciliation: net sales reconciliation For the years ended September 30, (Dollars in millions) 2015 % Chg 2016 % Chg 2017 % Chg 2018 % Chg 2019 % Chg PY $1,840.4 $1,631.6 $1,634.2 $1,755.7 $1,797.7 Organic (65.4) (3.6%) 60.4 3.7% 59.7 3.7% 22.5 1.3% 73.4 4.1% Impact of Acquisitions—0.0% 3