Energizer Holdings, Inc. has reported positive financial results for the fiscal 2025 third quarter, with net sales increasing by 3.4% to $725.3 million compared to the prior year period. Organic net sales grew by 0.1%, driven by a 1.7% increase in volumes, primarily due to new and expanded distribution in battery & lights. The reported gross margin was 55.1%, showing a significant improvement of 330 basis points compared to the prior year, largely attributed to the recording of estimated $112.4 million of production credits related to battery production in US facilities.
Adjusted gross margin also saw a notable increase of 330 basis points to 44.8%, reflecting the positive impact of the production credits and the company's Project Momentum initiatives, which delivered savings of approximately $12 million in the quarter. However, this improvement was partially offset by product cost impacts from increased freight and warehousing, production inefficiencies, and planned strategic pricing and promotional investments.
Earnings per share (EPS) and adjusted EPS witnessed substantial growth, with reported EPS at $2.13 and adjusted EPS at $1.13, marking a significant increase of 43% year-over-year on an adjusted basis. The company's improved performance led to an increased full-year outlook, with the adjusted EPS range raised to $3.55 to $3.65.
The company's operating cash flow for the nine months ended June 30, 2025, was $85.6 million, and free cash flow was $16.5 million, approximately 1% of net sales. Energizer Holdings also repurchased 2.8 million shares of common stock for $62.6 million during the third quarter and subsequently repurchased an additional 1.2 million shares of common stock. Dividend payments in the quarter amounted to approximately $21 million, or $0.30 per common share.
Looking ahead, the company expects to achieve net sales growth in the range of 1% to 3% for fiscal 2025, inclusive of the recently acquired business. Additionally, the adjusted EBITDA is anticipated to be in the range of $630 to $640 million, including an estimated benefit of $40 to $45 million from production credits before reinvestment.
The positive financial results and the improved outlook indicate that Energizer Holdings, Inc. is strongly positioned to drive continued earnings growth in fiscal year 2026. As a result of these announcements, the company's shares have moved 26.42% on the market, and are now trading at a price of $27.99. If you want to know more, read the company's complete 8-K report here.
