Personal care appliance and battery maker Rayovac included information reflecting the pro forma results of operations from the Microlite business in its results for the quarter ended June 27, 2004. Microlite, who owns the Rayovac brand in Brazil, had been included in Rayovac's consolidated results beginning after Sept. 30, 2002.
Microlite's pro forma results reflect the historical results of the Microlite business prior to the acquisition and do not take into consideration other changes occurring afterwards. The charges include interest expense which will be reduced as a result of Rayovac's recapitalization of assumed debt and lowered interest rates.
In addition to the one-time cost savings, Rayovac says it has taken actions to improve the operating results of the Microlite business, including installing a new general manager, rationalzing Microlite's product line, discontinuing certain low margin products, announcing price increases across all battery product lines, and implementing improvements that the company expects will generate manufacturing efficiencies and savings.
The company also announced Microlite's manufacturing facilities will support Rayovac's current business throughout the South American region, resulting in more efficient product sourcing with lower unit costs.
Rayovac reiterates its previous earnings guidance for fiscal years 2004 and 2005. Rayovac's net sales for the fiscal year ending September 30, 2004 are expected to be within a range of U.S. $1.35 to $1.4 billion, with pro forma diluted earnings per share of $1.78 to $1.81. In fiscal 2005, Rayovac expects diluted earnings per share of $2.05 to $2.10.
The guidance incorporates the projected financial impact of the Microlite acquisition. In fiscal 2005, Microlite is projected to generate net sales of $55 to $60 million.
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