Specialty battery maker Energizer Holdings Inc. (ENR), Tuesday announced plans to reduce its global workforce and cut overhead spending in a bid to improve cost competitiveness and enhance its financial standing.
Following the news, shares of the company gained nearly 10.0 percent in afternoon trade on the New York Stock Exchange.
Energizer said the move follows a comprehensive review of its cost structure and operating model. The company did not specify as to the number of jobs it will be slashing.
Other measures being planned by the St. Louis, Missouri-based company include manufacturing facility rationalization in its Household Products division.
Energizer said the cost cutting measures are expected to result in gross annualized pre-tax cost savings of $175 million to $200 million. The company anticipates that 70 to 80 percent of the savings will improve profitability, and remainder will be reinvested.
The company estimates one-time charges associated with the restructuring to be 1.25 times gross annualized savings.
Energizer expects modest benefits from the initiatives to begin accruing in the second half of fiscal 2013. It said most of the restructuring will be completed by fiscal 2014.
The company also reaffirmed its outlook for the full year 2012, expecting earnings in the range of $6.0 to $6.20 per share. Analysts currently expect earnings of $5.97 per share. Analysts' estimates typically exclude special items.
For the fourth quarter, Energizer continues to expect earnings to come in above the prior year.
Additionally, Energizer said its Nominating and Executive Compensation Committee approved changes to some components of its executive compensation structure, adding performance metrics as a key to improving long-term financial performance.
Energizer is set to release its fourth quarter earnings on November 9.
Shares of Energizer Holdings are trading at $74.26, up 9.33%, on a volume of over 2.0 million shares on the NYSE. In the past year, the stock traded in a range of $62.98 - $80.36.
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