ENERGIZER HOLDINGS INC

Previous wording

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 historical or future period, and are used for management incentive compensation. These non-GAAP financial measures exclude items that are not reflective of the Company's on-going operating performance, such as restructuring and related costs, acquisition and integration costs, the loss/(gain) on extinguishment of debt and the December 2023 Argentina Economic Reform. In addition, these measures help investors to analyze year over year comparability when excluding currency fluctuations as well as other Company initiatives that are not on-going. We believe these non-GAAP financial measures are an enhancement to assist investors in understanding our business and in performing analysis consistent with financial models developed by research analysts. Investors should consider non-GAAP measures in addition to, not as a substitute for, or superior to, the comparable GAAP measures. In addition, these non-GAAP measures may not be the same as similar measures used by other companies due to possible differences in methods and in the items being adjusted.

Current wording

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 historical or future period, and are used for management incentive compensation. These non-GAAP financial measures exclude items that are not reflective of the Company's on-going operating performance, such as impairment of intangible assets, restructuring and related costs, acquisition and integration costs, the loss/(gain) on extinguishment of debt and the December 2023 Argentina Economic Reform. In addition, these measures help investors to analyze year over year comparability when excluding currency fluctuations as well as other Company initiatives that are not on-going. We believe these non-GAAP financial measures are an enhancement to assist investors in understanding our business and in performing analysis consistent with financial models developed by research analysts. Investors should consider non-GAAP measures in addition to, not as a substitute for, or superior to, the comparable GAAP measures. In addition, these non-GAAP measures may not be the same as similar measures used by other companies due to possible differences in methods and in the items being adjusted.

Previous wording

Segment Profit. This amount represents the operations of our two reportable segments including allocations for shared support functions. General corporate and other expenses, Intangible amortization expense, Interest expense, Loss/(gain) on extinguishment of debt, Other items, net, restructuring and related costs, and the charges related to acquisition and integration costs have all been excluded from segment profit.

Current wording

Segment Profit. This amount represents the operations of our two reportable segments including allocations for shared support functions. General corporate and other expenses, Amortization of intangible assets, Impairment of intangible assets, Interest expense, Loss/(gain) on extinguishment of debt, Other items, net, restructuring and related costs, and the charges related to acquisition and integration costs have all been excluded from segment profit.

Previous wording

Adjusted Net Earnings and Adjusted Diluted Net Earnings Per Common Share (EPS). These measures exclude the impact of the costs related to restructuring and related costs, acquisition and integration, and the Loss/(gain) on extinguishment of debt and the December 2023 Argentina Economic Reform.

Current wording

Adjusted Net Earnings and Adjusted Diluted Net Earnings Per Common Share (EPS). These measures exclude the impact of restructuring and related costs, acquisition and integration, Impairment of intangible assets, the Loss/(gain) on extinguishment of debt and the December 2023 Argentina Economic Reform.

Previous wording

Non-GAAP Tax Rate. This is the tax rate when excluding the pre-tax impact of restructuring and related costs, acquisition and integration, and the loss/(gain) on extinguishment of debt and the December 2023 Argentina Economic Reform, as well as the related tax impact for these items, calculated utilizing the statutory rate for where the impact was incurred.

Current wording

Non-GAAP Tax Rate. This is the tax rate when excluding the pre-tax impact of restructuring and related costs, acquisition and integration, Impairment of intangible assets, the Loss/(gain) on extinguishment of debt and the December 2023 Argentina Economic Reform, as well as the related tax impact for these items, calculated utilizing the statutory rate for where the impact was incurred.

Previous wording

Adjusted Selling, General & Administrative Expense (SG&A) and Gross Margin as a percent of sales. Detail for Adjusted Gross margin and Adjusted SG&A as a percent of sales are also supplemental non-GAAP measures. These measures exclude the impact of costs related to restructuring and related costs, acquisition and integration.

Current wording

Adjusted Selling, General & Administrative Expense (SG&A) and Adjusted Gross Margin as a percent of sales. Detail for Adjusted Gross margin and Adjusted SG&A as a percent of sales are also supplemental non-GAAP measures. These measures exclude the impact of costs related to restructuring and related costs and acquisition and integration costs.

Previous wording

We continue to operate in an inflationary environment where macro-economic pressures and geopolitical instability are expected to continue in fiscal year 2024. While we did not experience significant disruptions in our operations in the first half of fiscal year 2024, the risks of future negative impacts due to transportation, including transportation issues in the Red Sea, logistical or supply constraints and higher commodity costs for certain raw materials remain present, and the Company could continue to experience corresponding incremental costs and gross margin pressures.

Current wording

We continue to operate in an inflationary environment where macro-economic pressures and geopolitical instability are expected to continue through the remainder of fiscal year 2024. While we did not experience significant disruptions in our operations so far in fiscal year 2024, the risks of future negative impacts due to transportation, including transportation issues in the Red Sea, logistical or supply constraints and higher commodity costs for certain raw materials remain present, and the Company could continue to experience corresponding incremental costs and gross margin pressures.

Previous wording

In November 2023, a new president was elected in Argentina who is implementing significant economic reform. Upon his inauguration in December 2023, the government devalued the Argentine Peso (ARS) approximately 50% over night. As a result, the Company anticipates that Argentina's operating costs may rise quicker than the Company is able to implement future price increases to offset rising costs, which may result in a near term decline to operating profit during fiscal 2024. The Company had net sales of $7.1 and $10.7 in the quarters ended March 31, 2024 and 2023, respectively, and $19.4 and $23.9 for the six months ended March 31, 2024 and 2023, respectively. The company had operating profit of $1.4 and $3.7 in the quarters ended March 31, 2024 and 2023, respectively, and $6.6 and $7.8 in the six months ended March 31, 2024 and 2023, respectively.

Current wording

In November 2023, a new president was elected in Argentina who is implementing significant economic reform. Upon his inauguration in December 2023, the government devalued the Argentine Peso (ARS) approximately 50% over night. As a result, the Company anticipates that Argentina's operating costs may rise quicker than the Company is able to implement future price increases to offset rising costs, which may result in a near term decline to operating profit during fiscal 2024. The Company had net sales of $9.4 and $10.4 in the quarters ended June 30, 2024 and 2023, respectively, and $28.8 and $34.3 for the nine months ended June 30, 2024 and 2023, respectively. The Company had operating profit of $2.2 and $3.9 in the quarters ended June 30, 2024 and 2023, respectively, and $8.8 and $11.7 in the nine months ended June 30, 2024 and 2023, respectively.

Previous wording

The December 2023 currency devaluation and economic reform resulted in $1.0 and $22.0 of currency related losses recognized in Other items, net during the quarter and six months ended March 31, 2024, respectively. The loss of $22.0 during the six months ended March 31, 2024 includes exchange losses of $14.7 from the December remeasurement of the Company's Argentina monetary assets and liabilities and $6.3 of transactional currency exchange losses on the ARS in December which are discussed further in Item 3 Quantitative and Qualitative Disclosures About Market Risk.

Current wording

The December 2023 currency devaluation and economic reform resulted in $22.0 of currency and related losses recognized in Other items, net during the nine months ended June 30, 2024. This includes exchange losses of $14.7 from the December remeasurement of the Company's Argentina monetary assets and liabilities and $6.3 of transactional currency exchange losses on the ARS in December which are discussed further in Item 3 Quantitative and Qualitative Disclosures About Market Risk. The Company also recorded a loss of $1.0 on the purchase and sale of bonds issued by the Argentina Central Bank (BCRA), named BOPREALs, which were issued to provide a USD denominated instrument for import companies to pay import debts existing before December 12, 2023, and regulate the flow of reserves from BCRA.

Previous wording

On October 27, 2023, the Company acquired certain battery manufacturing assets in Belgium from Advanced Power Solutions Belgium NV (APS) for a contractual purchase price of EUR3.5 (Belgium Acquisition). The Company also acquired certain raw materials from APS, procured by APS on the Company's behalf to facilitate the transition, for a total acquisition purchase price of $11.6 (including value added taxes). The Company assumed a building lease as part of the acquisition and acquired these assets to provide a battery manufacturing location in Europe.

Current wording

On October 27, 2023, the Company acquired certain battery manufacturing assets in Belgium from Advanced Power Solutions Belgium NV (APS) for a contractual purchase price of EUR3.5 (Belgium Acquisition). The Company also acquired certain raw materials from APS, procured by APS on the Company's behalf to facilitate the transition, for a total acquisition purchase price of $11.6 (including value added taxes). The Company assumed a building lease and the production employees as part of the acquisition, and acquired these assets to provide a battery manufacturing location in Europe.

Previous wording

The Company recorded $0.7 and $3.3 of acquisition and integration costs associated with the Belgium Acquisition during the quarter and six months ended March 31, 2024, respectively. The costs included $2.9 of operating costs recorded in Costs of good sold for the six months ended March 31, 2024, as the Company was awaiting the receipt of the raw materials procured on the Company's behalf by APS. These costs were offset by $1.0 of income during the six months ended March 31, 2024, recorded in Other items, net, from producing inventory for APS under a transaction services agreement (TSA) entered into at the closing of the transaction. No further income is expected from this TSA. The Company also recorded $0.7 and $1.4 of legal and diligence fees associated with the closing of this acquisition recorded in Selling, general and administrative expenses during the quarter and six months ended March 31, 2024, respectively.

Current wording

The Company recorded $1.6 and $4.9 of acquisition and integration costs during the quarter and nine months ended June 30, 2024, respectively. Costs of good sold included $0.2 and $3.1 recorded in the quarter and nine months ended June 30, 2024, respectively. The majority of this was recorded in the first fiscal quarter as the Company was awaiting the receipt of the raw materials procured on the Company's behalf by APS as part of the Belgium Acquisition. These costs were offset by $1.0 of income during the nine months ended June 30, 2024, recorded in Other items, net, from producing inventory for APS under a transaction services agreement (TSA) entered into at the closing of the transaction. No further income is expected from this TSA. The Company also recorded $1.4 and $2.8 of legal and diligence fees in Selling, general and administrative expenses related to acquisition and integration activities during the quarter and nine months ended June 30, 2024, respectively.

Previous wording

Following the Belgium Acquisition in the first quarter of fiscal 2024, the Company expanded the Project Momentum program and increased the savings and cost expectations, partially due to the impact the expanded manufacturing capacity will have on the Company's battery network. The restructuring component of the program is expected to generate $145 to $160 of annual pre-tax savings, and the Company estimates that it will incur one-time cash operating costs of $140 to $150, non-cash costs of approximately $20, and capital expenditures of $75 to $85 over the three year program. Additionally, along side the restructuring component of the program, Project Momentum includes continuous improvement and working capital initiatives that are designed to strengthen our balance sheet, focus on cash flow, and generate P&L savings of approximately $15 to $20 annually. Total expected pre-tax savings of Project Momentum are between $160 and $180 by the end of fiscal year 2025, with approximately $55 to $65 of those savings to be recognized in fiscal year 2024.

Current wording

Following the Belgium Acquisition in the first quarter of fiscal 2024, the Company expanded the Project Momentum program and increased the savings and cost expectations, partially due to the impact the expanded manufacturing capacity will have on the Company's battery network. The restructuring component of the program is expected to generate $155 to $170 of annual pre-tax savings, and the Company estimates that it will incur one-time cash operating costs of $150 to $170, non-cash costs of approximately $30, and capital expenditures of $75 to $85 over the three year program. Additionally, along side the restructuring component of the program, Project Momentum includes continuous improvement and working capital initiatives that are designed to strengthen our balance sheet, focus on cash flow, and generate P&L savings of approximately $25 to $30 annually. Total expected pre-tax savings of Project Momentum are between $180 and $200 by the end of fiscal year 2025, with approximately $80 to $90 of those savings to be recognized in fiscal year 2024.

Previous wording

As of March 31, 2024, the Company has realized approximately $96 of these savings from Project Momentum, with approximately $42 in fiscal year 2024. The savings were primarily within Cost of products sold and SG&A on the Consolidated (Condensed) Statements of Earnings and Comprehensive Income.

Current wording

As of June 30, 2024, the Company has realized approximately $117 of these savings from Project Momentum, with approximately $63 in fiscal year 2024. The savings were primarily within Cost of products sold and SG&A on the Consolidated (Condensed) Statements of Earnings and Comprehensive Income.

Previous wording

In the quarters ended March 31, 2024 and 2023, the total Project Momentum restructuring and related pre-tax costs were $23.4 and $7.5, respectively. For the six months ended March 31, 2024 and 2023, the total Project Momentum restructuring and related pre-tax costs were $45.8 and $14.1, respectively. The expenses primarily consisted of severance and other benefit related costs, accelerated depreciation, asset write-offs, consulting costs, IT enablement, decommissioning, relocation, and other exit related costs. These costs were reflected within Cost of products sold, SG&A and Other items, net on the Consolidated (Condensed) Statements of Earnings and Comprehensive Income.

Current wording

In the quarters ended June 30, 2024 and 2023, the total Project Momentum restructuring and related pre-tax costs were $18.8 and $9.1, respectively. For the nine months ended June 30, 2024 and 2023, the total Project Momentum restructuring and related pre-tax costs were $64.6 and $23.2, respectively. The expenses primarily consisted of severance and other benefit related costs, accelerated depreciation, asset write-offs, environmental cleanup, consulting costs, IT enablement, decommissioning, relocation, and other exit related costs. These costs were reflected within Cost of products sold, SG&A and Other items, net on the Consolidated (Condensed) Statements of Earnings and Comprehensive Income.

Previous wording

Although the Company's restructuring costs are recorded outside of segment profit, if allocated to our reportable segments, the pre-tax restructuring and related costs for the quarter and six months ended March 31, 2024 would be incurred within the Battery & Lights segment in the amounts of $20.5 and $41.2, respectively, and the Auto Care segment in the amount of $2.9 and $4.6, respectively. For the quarter and six months ended March 31, 2023, the pre-tax restructuring and related costs would have been incurred within the Battery & Lights segment in the amount of $6.8 and $12.6, respectively, and the Auto Care segment in the amount of $0.7 and $1.5, respectively.

Current wording

Although the Company's restructuring costs are recorded outside of segment profit, if allocated to our reportable segments, the pre-tax restructuring and related costs for the quarter and nine months ended June 30, 2024 would be incurred within the Battery & Lights segment in the amounts of $15.7 and $56.9, respectively, and the Auto Care segment in the amount of $3.1 and $7.7, respectively. For the quarter and nine months ended June 30, 2023, the pre-tax restructuring and related costs would have been incurred within the Battery & Lights segment in the amount of $8.3 and $20.9, respectively, and the Auto Care segment in the amount of $0.8 and $2.3, respectively.

Previous wording

Project Momentum restructuring and related costs since inception are $106.4. Refer to Note 4, Restructuring, to the Consolidated (Condensed) Financial Statements for additional discussion on the Company's restructuring costs.

Current wording

Project Momentum restructuring and related costs since inception are $125.2. Refer to Note 4, Restructuring, to the Consolidated (Condensed) Financial Statements for additional discussion on the Company's restructuring costs.

Previous wording

Energizer reported second fiscal quarter Net earnings of $32.4, or $0.45 per diluted common share, compared to Net earnings of $40.0, or $0.55 per diluted common share, in the prior year second fiscal quarter. Adjusted Diluted net earnings per common share was $0.72 for the second fiscal quarter as compared to $0.64 in the prior year quarter.

Current wording

Energizer reported a third fiscal quarter Net loss of $43.8, or a loss of $0.61 per common share, compared to Net earnings of $31.8, or $0.44 per diluted common share, in the prior year third fiscal quarter. Adjusted Diluted net earnings per common share was $0.79 for the third fiscal quarter as compared to $0.54 in the prior year quarter, an increase of 46%.

Previous wording

For the six months ended March 31, 2024, Energizer reported Net earnings of $34.3, or $0.47 per diluted common share, compared to Net earnings of $89.0, or $1.23 per diluted common share, in the prior year comparable period. Adjusted diluted net earnings per common share was $1.30 for the six months period as compared to the $1.36 in the prior year comparable period.

Current wording

For the nine months ended June 30, 2024, Energizer reported a Net loss of $9.5, or a loss of $0.13 per common share, compared to Net earnings of $120.8, or $1.67 per diluted common share, in the prior year comparable period. Adjusted diluted net earnings per common share was $2.09 for the nine months period as compared to the $1.90 in the prior year comparable period, an increase of 10%.

Previous wording

Net earnings and Diluted net earnings per common share for the time periods presented were impacted by certain items related to restructuring and related costs, acquisition and integration costs, the Loss/(gain) on extinguishment of debt and the December 2023 Argentina Economic Reform as described in the tables below. The impact of these items is provided below as a reconciliation of Net earnings and Diluted net earnings per common share to Adjusted Net earnings and Adjusted Diluted net earnings per common share, which are non-GAAP measures. See disclosure on Non-GAAP Financial Measures above.

Current wording

Net (loss)/earnings and Diluted net (loss)/earnings per common share for the time periods presented were impacted by certain items related to restructuring and related costs, acquisition and integration costs, Impairment of intangible assets, the Loss/(gain) on extinguishment of debt and the December 2023 Argentina Economic Reform as described in the tables below. The impact of these items is provided below as a reconciliation of Net (loss)/earnings and Diluted net (loss)/earnings per common share to Adjusted Net earnings and Adjusted Diluted net earnings per common share, which are non-GAAP measures. See disclosure on Non-GAAP Financial Measures above.

Previous wording

Currency, excluding hyperinflationary markets, had an adverse impact to the quarter ended March 31, 2024 of $2.5 in Earnings before income taxes, or $0.03 per share. For the six months ended March 31, 2024, currency benefited the period by $3.1 in Earnings before income taxes, or $0.03 per share.

Current wording

Currency, excluding hyperinflationary markets, had an adverse impact to the quarter ended June 30, 2024 of $1.9 in Earnings before income taxes, or $0.02 per share. For the nine months ended June 30, 2024, currency benefited the period by $1.2 in Earnings before income taxes, or $0.01 per share.

Previous wording

(2) Acquisition and integration costs of $0.7 were recorded in SG&A on the Consolidated (Condensed) Statement of Earnings during the quarter ended March 31, 2024. For the six months ended March 31, 2024, acquisition and integration costs of $3.3 included costs of $2.9 recorded in Costs of goods sold and $1.4 recorded in SG&A, partially offset by TSA income of $1.0 recorded in Other items, net on the Consolidated (Condensed) Statement of Earnings.

Current wording

(2) For the quarter ended June 30, 2024, the acquisition and integration costs of $1.6 included costs of $0.2 recorded in Cost of goods sold and $1.4 recorded in SG&A on the Consolidated (Condensed) Statement of Earnings. For the nine months ended June 30, 2024, the acquisition and integration costs of $4.9 included costs of $3.1 recorded in Costs of goods sold and $2.8 recorded in SG&A, partially offset by TSA income of $1.0 recorded in Other items, net on the Consolidated (Condensed) Statement of Earnings.

Previous wording

(3) During December 2023, a new president was inaugurated in Argentina bringing significant economic reform to the country including devaluing the Argentine Peso by 50% in the month of December. As a result of this reform and devaluation, the Company recorded $1.0 and $22.0 of exchange and related losses for the quarter and six months ended March 31, 2024, respectively, in Other items, net on the Consolidated (Condensed) Statement of Earnings.

Current wording

(3) During December 2023, a new president was inaugurated in Argentina bringing significant economic reform to the country including devaluing the Argentine Peso by 50% in the month of December. As a result of this reform and devaluation, the Company recorded $22.0 of exchange and related losses for the nine months ended June 30, 2024 in Other items, net on the Consolidated (Condensed) Statement of Earnings.

Previous wording

(4) The effective tax rate for the Adjusted Net earnings and Adjusted Diluted EPS for the quarters ended March 31, 2024 and 2023 was 23.3% and 20.9%, respectively, and for the six months ended March 31, 2024 and 2023 was 23.6% and 21.2%, respectively, as calculated utilizing the statutory rate for where the costs were incurred.

Current wording

(4) The effective tax rate for the Adjusted Net earnings and Adjusted Diluted EPS for the quarters ended June 30, 2024 and 2023 was 23.2% and 21.9%, respectively, and for the nine months ended June 30, 2024 and 2023 was 23.4% and 21.4%, respectively, as calculated utilizing the statutory rate for where the costs were incurred.

Previous wording

Net sales were $663.3 for the second fiscal quarter of 2024, a decrease of $20.8 as compared to the prior year quarter. Organic Net sales decreased 2.7%, due to the following items:

Current wording

Net sales were $701.4 for the third fiscal quarter of 2024, an increase of $2.0 as compared to the prior year quarter. Organic Net sales increased 1.2%, due to the following items:

Previous wording

Net sales were $1,379.9 for the six months ended March 31, 2024, a decrease of $69.3 as compared to the prior year period. Organic Net sales decreased 5.2%, driven by the following items:

Current wording

Net sales were $2,081.3 for the nine months ended June 30, 2024, a decrease of $67.3 as compared to the prior year period. Organic Net sales decreased 3.1%, driven by the following items:

Previous wording

•The battery business experienced volume declines of approximately 3.9% primarily due to earlier holiday orders compared to the prior year, which benefited the fourth quarter of 2023, and weaker performance at non-tracked channels; and

Current wording

•The Battery & Lights segment experienced volume declines of approximately 1.5% primarily due to earlier holiday orders compared to the prior year, which benefited the fourth quarter of 2023, and weaker performance at non-tracked channels, partially offset by distribution gains; and

Previous wording

•Increased Auto Care volumes of 0.5% largely driven by distribution gains in the period partially offset these declines.

Current wording

•Increased Auto Care volumes of 0.7% largely driven by distribution gains in the period partially offset these declines.

Previous wording

Gross margin percentageon a reported basis for the second fiscal quarter of 2024 was 38.2%, compared to 37.0% in the prior year. Excluding restructuring costs in the current and prior year of $15.5 and $5.7, respectively, Adjusted Gross margin was 40.5% compared to 37.9% in the prior year, an increase of 260 basis points.

Current wording

Gross margin percentageon a reported basis for the third fiscal quarter of 2024 was 39.5%, compared to 37.9% in the prior year, an increase of 160 basis points. Excluding restructuring costs in the current and prior year of $13.4 and $6.5, respectively, and integration costs in the current year of $0.2, Adjusted Gross margin was 41.5% compared to 38.8% in the prior year, an increase of 270 basis points.

Previous wording

Gross margin percentage on a reported basis for the six months ended March 31, 2024 was 37.7%, compared to 38.1%

Current wording

Gross margin percentage on a reported basis for the nine months ended June 30, 2024 was 38.3%, compared to 38.0%

Previous wording

in the prior year. Excluding restructuring costs in the current and prior year of $28.3 and $6.0, respectively, and current year acquisition and integration costs of $2.9, Adjusted Gross margin was 40.0% compared to 38.5% in the prior year, an increase of 150 basis points.

Current wording

in the prior year, an increase of 30 basis points. Excluding restructuring costs in the current and prior year of $41.7 and $12.5, respectively, and current year integration costs of $3.1, Adjusted Gross margin was 40.5% compared to 38.6% in the prior year, an increase of 190 basis points.

Previous wording

Adjusted Gross margin improvement in the second fiscal quarter of 2024 was largely driven by Project Momentum, which delivered savings of approximately $11 in the quarter, as well as lower input costs, including improved commodities pricing and lower ocean freight. These benefits were partially offset by the planned strategic pricing and promotional investments noted above.

Current wording

Adjusted Gross margin improvement in the third fiscal quarter was driven by both Project Momentum initiatives, which delivered savings of approximately $14 in the quarter, as well as lower input costs, including improved commodity and material pricing and lower ocean freight. These benefits were partially offset by the planned strategic pricing and promotional investments noted above.

Previous wording

Adjusted Gross margin improvement for the six months ended March 31, 2024 was largely driven by Project Momentum, which delivered savings of approximately $27 in the period, as well as lower input costs, including improved commodities pricing and lower ocean freight. These benefits were partially offset by the planned strategic pricing and promotional investments noted above and negative product mix impact.

Current wording

Adjusted Gross margin improvement for the nine months ended June 30, 2024 was largely driven by Project Momentum, which delivered savings of approximately $41 in the period, as well as lower input costs, including improved commodities pricing and lower ocean freight. These benefits were partially offset by the planned strategic pricing and promotional investments noted above and negative product mix impact.

Previous wording

SG&A was $122.5 in the second fiscal quarter of 2024, or 18.5% of Net sales, as compared to $118.3, or 17.3% of Net sales, in the prior year period. Included in SG&A during the second fiscal quarter of 2024 were acquisition and integration costs of $0.7, and included in the second fiscal quarter of both 2024 and 2023 were restructuring and related costs of $7.9 and $1.8, respectively. Excluding these restructuring and related costs and acquisition and integration costs, adjusted SG&A was $113.9, or 17.2% of Net sales in the second fiscal quarter of 2024, as compared to $116.5, or 17.0% of Net sales in the prior year period. The year-over-year decrease was primarily driven by savings from Project Momentum of approximately $9. This decrease was partially offset by higher environmental expense, factoring fees and travel.

Current wording

SG&A was $129.6 in the third fiscal quarter of 2024, or 18.5% of Net sales, as compared to $116.1, or 16.6% of Net sales, in the prior year period. Included in SG&A during the third fiscal quarter of 2024 were acquisition and integration costs of $1.4, and included in the third fiscal quarter of both 2024 and 2023 were restructuring and related costs of $9.8 and $2.8, respectively. Excluding these restructuring and related costs and acquisition and integration costs, Adjusted SG&A was $118.4, or 16.9% of Net sales in the third fiscal quarter of 2024, as compared to $113.3, or 16.2% of Net sales in the prior year period. The year-over-year increase was primarily driven by an increase in labor and benefit costs, higher travel expense, increased depreciation expense related to our digital transformation initiatives and increased legal fees. This increase was partially offset by savings from Project Momentum of approximately $7.

Previous wording

SG&A was $250.6 in the six months ended March 31, 2024, or 18.2% of Net sales, as compared to $238.7, or 16.5% of Net sales, in the prior year period. Included in SG&A during the six months ended March 31, 2024 were acquisition and integration costs of $1.4, and included in both six months ended 2024 and 2023 were restructuring and related costs of $17.5 and $8.1, respectively. Excluding these restructuring and related costs and acquisition and integration costs, adjusted SG&A was $231.7, or 16.8% of Net sales in the six months ended March 31, 2024, as compared to $230.6, or 15.9% of Net sales in the prior year period. The year-over-year increase was primarily driven by higher labor and benefit costs, factoring fees, environmental expense and travel. This increase was partially offset by Project Momentum savings of approximately $15 in the period.

Current wording

SG&A was $380.2 in the nine months ended June 30, 2024, or 18.3% of Net sales, as compared to $354.8, or 16.5% of Net sales, in the prior year period. Included in SG&A during the nine months ended June 30, 2024 were acquisition and integration costs of $2.8, and included in both the nine months ended 2024 and 2023 were restructuring and related costs of $27.3 and $10.9, respectively. Excluding these restructuring and related costs and acquisition and integration costs, Adjusted SG&A was $350.1, or 16.8% of Net sales in the nine months ended June 30, 2024, as compared to $343.9, or 16.0% of Net sales in the prior year period. The year-over-year increase was primarily driven by increased labor and benefit costs, factoring fees, environmental fees, travel and legal fees. This increase was partially offset by Project Momentum savings of approximately $22 in the period.

Previous wording

Advertising and sales promotion expense (A&P) was $21.4, or 3.2% of net sales, in the second fiscal quarter of 2024, as compared to $18.4, or 2.7% of Net sales, in the second fiscal quarter of 2023. A&P was $68.4, or 5.0% of net sales, in the six months ended March 31, 2024, as compared to $71.8, or 5.0% of Net sales, in the prior year comparative period.

Current wording

Advertising and sales promotion expense (A&P) was $37.9, or 5.4% of net sales, in the third fiscal quarter of 2024, as compared to $37.6, or 5.4% of Net sales, in the third fiscal quarter of 2023. A&P was $106.3, or 5.1% of net sales, in the nine months ended June 30, 2024, as compared to $109.4, or 5.1% of Net sales, in the prior year comparative period.

Previous wording

R&D was $7.9, or 1.2% of Net sales, for the quarter ended March 31, 2024, as compared to $8.0, or 1.2% of Net sales, in the prior year comparative period. R&D was $15.7, or 1.1% of Net sales, for the six months ended March 31, 2024, as compared to $15.6, or 1.1% of Net sales, in the prior year comparative period.

Current wording

R&D was $7.4, or 1.1% of Net sales, for the quarter ended June 30, 2024, as compared to $8.8, or 1.3% of Net sales, in the prior year comparative period. R&D was $23.1, or 1.1% of Net sales, for the nine months ended June 30, 2024, as compared to $24.4, or 1.1% of Net sales, in the prior year comparative period.

Previous wording

Interest expensewas $38.7 for the second fiscal quarter of 2024 compared to $42.0 for the prior year comparative period. For the six months ended March 31, 2024 interest expense was $79.4 as compared to $84.9 for the prior year comparative period. The lower interest expense was due to a lower average outstanding debt balance in the current year due to the Company's initiatives to pay down debt, partially offset by higher interest rates.

Current wording

Interest expensewas $38.5 for the third fiscal quarter of 2024 compared to $42.2 for the prior year comparative period. For the nine months ended June 30, 2024 interest expense was $117.9 as compared to $127.1 for the prior year comparative period. The lower interest expense was due to a lower average outstanding debt balance in the current year due to the Company's initiatives to pay down debt, partially offset by higher interest rates.

Previous wording

Loss on extinguishment of debt was $0.4 for the second fiscal quarter of 2024, and relates to the Company's early repayment of $60.0 outstanding on the term loan. The loss on extinguishment of debt of $0.9 for the second fiscal quarter of 2023 related to the Company's early repayment of $100.0 outstanding on the term loan.

Current wording

Loss on extinguishment of debt was $1.2 for the third fiscal quarter of 2024 and primarily relates to the Company's term loan repricing during the quarter. The loss on extinguishment of debt of $0.3 for the third fiscal quarter of 2023 related to the Company's early repayment of $41.0 outstanding on the term loan.

Previous wording

Loss on extinguishment of debt was $0.9 for the six months ended March 31, 2024, and relates to the Company's early repayment of $135.0 outstanding on the term loan. The gain on extinguishment of debt of $2.0 for the six months ended March 31, 2023 related to the Company's retirement of $25.0 of outstanding Senior Notes at a discount and the early repayment of $125.0 outstanding on the term loan.

Current wording

Loss on extinguishment of debt was $2.1 for the nine months ended June 30, 2024, and relates to the Company's early repayment of $141.0 outstanding on the term loan as well as the term loan repricing during the current quarter. The gain on extinguishment of debt of $1.7 for the nine months ended June 30, 2023 related to the Company's retirement of $25.0 of outstanding Senior Notes at a discount and the early repayment of $166.0 outstanding on the term loan.

Previous wording

Other items, netwas expense of $5.5 and $0.8 for the second fiscal quarters of 2024 and 2023, respectively. Other items, net was expense of $24.5 and a benefit of $0.6 for the six months ended March 31, 2024 and 2023, respectively.

Current wording

Other items, netwas a benefit of $5.0 and an expense of $5.2 for the third fiscal quarters of 2024 and 2023, respectively. Other items, net was expense of $19.5 and $4.6 for the nine months ended June 30, 2024 and 2023, respectively.

Previous wording

(1) Foreign currency exchange loss includes the currency impact from the December 2023 Argentina economic reform. During December 2023, a new president wasinaugurated in Argentina bringing significant economic reform to the country including devaluing the Argentine Peso by 50% in the month of December. As a result of this reform and devaluation, the Company recorded $21.0 of exchange losses for the six months ended March 31, 2024 in Other items, net on the Consolidated (Condensed) Statement of Earnings.

Current wording

(1) Foreign currency exchange loss includes the currency impact from the December 2023 Argentina economic reform. During December 2023, a new president wasinaugurated in Argentina bringing significant economic reform to the country including devaluing the Argentine Peso by 50% in the month of December. As a result of this reform and devaluation, the Company recorded $21.0 of exchange losses for the nine months ended June 30, 2024 in Other items, net on the Consolidated (Condensed) Statement of Earnings.