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, network transition costs, acquisition and integration costs, the loss on extinguishment/modification 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 restructuring and related costs, network transition costs, acquisition and integration costs, FY23 & FY24 production credits, a litigation matter, an impairment on intangible assets, the loss on extinguishment/modification 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 on extinguishment/modification of debt, Other items, net, restructuring and related costs, network transition 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, Intangible amortization expense, an impairment on intangible assets, Interest expense, Loss on extinguishment/modification of debt, Other items, net, restructuring and related costs, network transition costs, FY23 & FY24 production credits, a litigation matter 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 activities, network transition costs, acquisition and integration, the Loss on extinguishment/modification 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 the costs related to restructuring activities, network transition costs, acquisition and integration, an impairment on intangible assets, FY23 & FY24 production credits, a litigation matter, the Loss on extinguishment/modification 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 activities, network transition activities, acquisition and integration, the loss on extinguishment/modification of debt and the December 2023 Argentina

Current wording

Non-GAAP Tax Rate. This is the tax rate when excluding the pre-tax impact of restructuring activities, network transition activities, acquisition and integration, an impairment on intangible assets, FY23 & FY24 production credits, a litigation matter, the loss on extinguishment/modification 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 Gross Margin, Adjusted Selling, General & Administrative Expense (SG&A) as a percent of sales, and Adjusted Other items, net. Detail for Adjusted Gross margin, Adjusted SG&A as a percent of sales, and Adjusted Other items, net are also supplemental non-GAAP measures. These measures exclude the impact of costs related to restructuring activities, network transition activities, and acquisition and integration.

Current wording

Adjusted Gross Margin, Adjusted Selling, General & Administrative Expense (SG&A) as a percent of sales, and Adjusted Other items, net. Detail for Adjusted Gross margin, Adjusted SG&A as a percent of sales, and Adjusted Other items, net are also supplemental non-GAAP measures. These measures exclude the impact of costs related to restructuring activities, network transition activities, FY23 & FY24 production credits, a litigation matter and acquisition and integration.

Previous wording

We continue to operate in an inflationary environment where macro-economic pressures and geopolitical instability are expected to continue in fiscal 2025. While we did not experience significant disruptions in our operations in the first half of fiscal 2025, the risks of future negative impacts due to higher tariffs, transportation, 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 as well as currency headwinds throughout the year. Macro-economic pressures and geopolitical instability could also result in softening consumer demand, which could negatively impact the Company's forecasted financial results and operations.

Current wording

We continue to operate in an inflationary environment where macro-economic pressures and geopolitical instability are expected to continue in fiscal 2025. While we have not experienced significant disruptions in our operations so far in fiscal 2025, the risks of future negative impacts due to higher tariffs, transportation, 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 as well as currency headwinds throughout the year. Macro-economic pressures and geopolitical instability could also result in softening consumer demand, which could negatively impact the Company's forecasted financial results and operations.

Previous wording

costs. The Company anticipates this could continue, resulting in a continued decline to operating profit during fiscal 2025. The Company had net sales of $9.2 and $7.1 in the quarters ended March 31, 2025 and 2024, respectively, and $16.9 and $19.4 for the six months ended March 31, 2025 and 2024, respectively. The Company had operating profit of $2.4 and $1.4 in the quarters ended March 31, 2025 and 2024, respectively, and $4.3 and $6.6 in the six months ended March 31, 2025 and 2024, respectively.

Current wording

result, Argentina's operating costs rose quicker than the Company was able to implement price increases to offset the rising costs. The Company anticipates this could continue, resulting in a continued decline to operating profit. The Company had net sales of $10.3 and $9.4 in the quarters ended June 30, 2025 and 2024, respectively, and $27.2 and $28.8 for the nine months ended June 30, 2025 and 2024, respectively. The Company had operating profit of $3.4 and $2.2 in the quarters ended June 30, 2025 and 2024, respectively, and $7.7 and $8.8 in the nine months ended June 30, 2025 and 2024, respectively.

Previous wording

This devaluation and economic reform resulted in $1.0 and $22.0 of currency and related losses recognized in Other items, net in the three 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 2023 remeasurement of the Company's Argentina monetary assets and liabilities, $6.3 of transactional currency exchange losses on the ARS, as well as a $1.0 loss on the purchase and sale of bonds issued by the Argentina Central Bank.

Current wording

This devaluation and economic reform resulted in $22.0 of currency and related losses recognized in Other items, net in the nine months ended June 30, 2024, respectively. The loss of $22.0 during the nine months ended June 30, 2024 includes exchange losses of $14.7 from the December 2023 remeasurement of the Company's Argentina monetary assets and liabilities, $6.3 of transactional currency exchange losses on the ARS, as well as a $1.0 loss on the purchase and sale of bonds issued by the Argentina Central Bank.

Previous wording

Subsequent to quarter end, on May 2, 2025, the Company completed the Advanced Power Solutions NV Acquisition. The initial cash transferred was EUR13.3 after the preliminary working capital and net debt adjustments. The acquisition provides the Company with additional production capacity in Europe as well as an expanded customer base.

Current wording

On May 2, 2025, the Company acquired all the shares of APS NV. The acquisition provides the Company with additional production capacity in Europe as well as an expanded customer base. The acquisition included $20.8 of Net sales and $0.4 of Segment profit for the Battery and Lights segment.

Previous wording

In fiscal 2025, the Company recorded $2.3 and $3.5 in SG&A of legal fees and other costs associated with these acquisitions during the quarter and six months ended March 31, 2025, respectively. Included in the quarter and six months was expense of $0.8 for a purchase price earnout adjustment associated with the Centralsul Acquisition.

Current wording

In fiscal 2025, the Company recorded $1.3 and $4.8 in SG&A of legal fees and other costs associated with these acquisitions during the quarter and nine months ended June 30, 2025, respectively. Included in the quarter and nine months was expense for a purchase price earnout adjustment associated with the Centralsul Acquisition.of $0.3 and $1.1, respectively.

Previous wording

In fiscal 2024, 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

In fiscal 2024, 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 Belgium 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 Belgium 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 approximately $180 of annual pre-tax savings, and the Company estimates that it will incur one-time cash operating costs of approximately $180 to $185, non-cash costs of approximately $30, and capital expenditures of $80 to $90 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 $20 annually.

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 over $180 of annual pre-tax savings, and the Company estimates that it will incur one-time cash operating costs of over $180, non-cash costs of approximately $30, and capital expenditures of $80 to $90 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 $20 annually.

Previous wording

Total expected pre-tax savings of Project Momentum are approximately $200 by the end of fiscal 2025. As of March 31, 2025, the Company has realized approximately $181 of these savings from Project Momentum, with approximately $39 in fiscal 2025. The savings were primarily within Cost of products sold and SG&A on the Consolidated (Condensed) Statements of Earnings and Comprehensive Income.

Current wording

Total expected pre-tax savings of Project Momentum are over $200 by the end of fiscal 2025. As of June 30, 2025, the Company has realized approximately $196 of these savings from Project Momentum, with approximately $54 in fiscal 2025. 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, 2025 and 2024, the total Project Momentum restructuring and related pre-tax costs were $17.6 and $23.4, respectively. For the six months ended March 31, 2025 and 2024, the total Project Momentum restructuring and related pre-tax costs were $37.9 and $45.8, respectively. The expenses primarily consisted of severance and other benefit related costs, accelerated depreciation, asset write-offs, consulting costs, IT enablement, a non-cash impairment of capitalized software, 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. Project Momentum restructuring and related costs since inception are $190.2. Refer to Note 4, Restructuring, to the Consolidated (Condensed) Financial Statements for additional discussion on the Company's restructuring costs.

Current wording

In the quarters ended June 30, 2025 and 2024, the total Project Momentum restructuring and related pre-tax costs were $8.0 and $18.8, respectively. For the nine months ended June 30, 2025 and 2024, the total Project Momentum restructuring and related pre-tax costs were $45.9 and $64.6, respectively. The expenses primarily consisted of severance and other benefit related costs, accelerated depreciation, asset write-offs, consulting costs, IT enablement, a non-cash impairment of capitalized software, 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. Project Momentum restructuring and related costs since inception are $198.2. Refer to Note 4, Restructuring, to the Consolidated (Condensed) Financial Statements for additional discussion on the Company's restructuring costs.

Previous wording

Although the Company's Project Momentum restructuring costs are recorded outside of segment profit, if allocated to our reportable segments, the restructuring and related costs for the quarter and six months ended March 31, 2025 would be incurred within the Battery & Lights segment in the amount of $15.7 and $34.4, respectively, and the Auto Care segment in the amount of $1.9 and $3.5, respectively. The Company's Project Momentum restructuring costs for the quarter and six months ended March 31, 2024 would be incurred within the Battery & Lights segment in the amount of $20.5 and $41.2, respectively, and the Auto Care segment in the amount of $2.9 and $4.6, respectively.

Current wording

Although the Company's Project Momentum restructuring costs are recorded outside of segment profit, if allocated to our reportable segments, the restructuring and related costs for the quarter and nine months ended June 30, 2025 would be incurred within the Battery & Lights segment in the amount of $7.1 and $41.5, respectively, and the Auto Care segment in the amount of $0.9 and $4.4, respectively. The Company's Project Momentum restructuring costs for the quarter and nine months ended June 30, 2024 would be incurred within the Battery & Lights segment in the amount of $15.7 and $56.9, respectively, and the Auto Care segment in the amount of $3.1 and $7.7, respectively.

Previous wording

As a part of the planned Project Momentum decommissioning of certain facilities and relocation of multiple production and packaging lines, the Company incurred incremental costs related to network transition activities necessary to maintain business continuity. During the three and six months ended March 31, 2025, the Company incurred incremental costs of $2.7 and 16.7, respectively, primarily related to freight and third-party packaging support to ensure product availability for key customers during the movement and subsequent prove-in of the relocated lines. These costs were incurred within Cost of products sold on the Consolidated (Condensed) Statement of Earnings and Comprehensive Income. The network transition activities as part of Project Momentum are substantially complete and the Company does not anticipate significant network transition costs for the remainder of fiscal 2025.

Current wording

As a part of the planned Project Momentum decommissioning of certain facilities and relocation of multiple production and packaging lines, the Company incurred incremental costs related to network transition activities necessary to maintain business continuity. During the three and nine months ended June 30, 2025, the Company incurred incremental costs of $0.9 and $17.6, respectively, primarily related to freight and third-party packaging support to ensure product availability for key customers during the movement and subsequent prove-in of the relocated lines. These costs were incurred within Cost of products sold on the Consolidated (Condensed) Statement of Earnings and Comprehensive Income. The network transition activities as part of Project Momentum are substantially complete and the Company does not anticipate significant network transition costs for the remainder of fiscal 2025.

Previous wording

Energizer reported second fiscal quarter Net earnings of $28.3, or $0.39 per diluted common share, compared to Net earnings of $32.4, or $0.45 per diluted common share, in the prior year second fiscal quarter. Adjusted Diluted net earnings per common share was $0.67 for the second fiscal quarter as compared to $0.72 in the prior year quarter.

Current wording

Energizer reported third fiscal quarter Net earnings of $153.5, or $2.13 per diluted common share, compared to Net loss of $43.8, or a loss of $0.61 per common share, in the prior year third fiscal quarter. Adjusted Diluted net earnings per common share was $1.13 for the third fiscal quarter as compared to $0.79 in the prior year quarter, an increase of 43% on an adjusted basis.

Previous wording

For the six months ended March 31, 2025, Energizer reported Net earnings of $50.6, or $0.69 per diluted common share, compared to Net earnings of $34.3, or $0.47 per diluted common share, in the prior year comparable period. Adjusted diluted net earnings per common share was $1.35 for the six months period as compared to the $1.30 in the prior year comparable period.

Current wording

For the nine months ended June 30, 2025, Energizer reported Net earnings of $204.1, or $2.80 per diluted common share, compared to Net loss of $9.5, or a loss of $0.13 per common share, in the prior year comparable period. Adjusted diluted net earnings per common share was $2.47 for the nine months period as compared to the $2.09 in the prior year comparable period, an increase of 18% on an adjusted basis.

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, network transition costs, acquisition and integration costs, the Loss on extinguishment/modification 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 earnings/(loss) and Diluted net earnings/(loss) per common share for the time periods presented were impacted by certain items related to restructuring and related costs, network transition costs, acquisition and integration costs, FY23 & FY24 production credits, impairment of intangible assets, a litigation matter, the Loss on extinguishment/modification 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/(loss) and Diluted net earnings/(loss) 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, unfavorably impacted the quarter ended March 31, 2025 by $2.7 in Earnings before income taxes, or $0.03 per share, compared to the prior year quarter. For the six months ended March 31, 2025, currency, excluding hyperinflationary markets, unfavorably impacted the period by $1.2 in Earnings before income taxes, or $0.01 per share.

Current wording

Currency, excluding hyperinflationary markets, unfavorably impacted the quarter ended June 30, 2025 by $2.5 in Earnings before income taxes, or $0.03 per share, compared to the prior year quarter. For the nine months ended June 30, 2025, currency, excluding hyperinflationary markets, unfavorably impacted the period by $3.7 in Earnings before income taxes, or $0.04 per share.

Previous wording

(4) 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

(7) 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, respectively, in Other items, net on the Consolidated (Condensed) Statement of Earnings.

Previous wording

(5) The effective tax rate for the Adjusted Net earnings and Adjusted Diluted EPS for the quarters ended March 31, 2025 and 2024 was 23.1% and 23.3%, respectively, and for the six months ended March 31, 2025 and 2024 was 23.9% and 23.6%, respectively, as calculated utilizing the statutory rate for where the costs were incurred.

Current wording

(8) The effective tax rate for the Adjusted Net earnings and Adjusted Diluted EPS for the quarters ended June 30, 2025 and 2024 was 13.5% and 23.2%, respectively, and for the nine months ended June 30, 2025 and 2024 was 19.5% and 23.4%, respectively, as calculated utilizing the statutory rate for where the costs were incurred. The production credit adjustment has no associated statutory tax impact.

Previous wording

Net sales were $662.9 for the second fiscal quarter of 2025, a decrease of $0.4 as compared to the prior year quarter. Organic Net sales improved 1.4%, primarily driven by the following items:

Current wording

Net sales were $725.3 for the third fiscal quarter of 2025, an increase of $23.9 as compared to the prior year quarter. Organic Net sales improved 0.1%, primarily driven by the following items:

Previous wording

Net sales were $1,394.6 for the six months ended March 31, 2025, an increase of $14.7 as compared to the prior year period. Organic Net sales increased 2.6%, driven by the following items:

Current wording

Net sales were $2,119.9 for the nine months ended June 30, 2025, an increase of $38.6 as compared to the prior year period. Organic Net sales increased 1.8%, driven by the following items:

Previous wording

•New and expanded distribution, as well as incremental storm related activity, drove volume increases in Battery & Lights of 3.6%.

Current wording

•Volumes grew 3.2% for the period, driven primarily by new and expanded distribution, as well as incremental storm related activity, in the Battery & Lights business; and

Previous wording

•Partially offsetting the increased volumes were planned strategic pricing and promotional investments of 0.5%.

Current wording

•Partially offsetting the increased volumes were planned strategic pricing and promotional investments of 1.4%.

Previous wording

Gross margin percentageon a reported basis for the second fiscal quarter of 2025 was 39.1%, compared to 38.2% in the prior year. Excluding restructuring costs in the current and prior year of $8.7 and $15.5, respectively, and network transition costs of $2.7 in the current year, Adjusted Gross margin was 40.8% compared to 40.5% in the prior year, an increase of 30 basis points.

Current wording

For the three quarter ended June 30, 2025, excluding prior year production credits of $78.5, restructuring costs in the current and prior year of $2.9 and $13.4, respectively, network transition costs of $0.9 in the current year and acquisition and integration costs of $0.2 in the prior year, Adjusted Gross margin was 44.8% compared to 41.5% in the prior year, an increase of 330 basis points.

Previous wording

Gross margin percentage on a reported basis for the six months ended March 31, 2025 was 37.9%, compared to 37.7%

Current wording

Gross margin percentage on a reported basis for the nine months ended June 30, 2025 was 43.8%, compared to 38.3%

Previous wording

in the prior year. Excluding restructuring costs in the current and prior year of $18.1 and $28.3, respectively, current year network transition costs of $16.7 and prior year acquisition and integration costs of $2.9, Adjusted Gross margin was 40.4% compared to 40.0% in the prior year, an increase of 40 basis points.

Current wording

in the prior year. Excluding prior year production credits of $78.5, restructuring and related costs in the current and prior year of $21.0 and $41.7, respectively, current year network transition costs of $17.6 and prior year acquisition and integration costs of $3.1, Adjusted Gross margin was 41.9% compared to 40.5% in the prior year, an increase of 140 basis points.

Previous wording

Adjusted Gross margin improvement in the second fiscal quarter of 2025 was largely driven by Project Momentum which delivered savings of approximately $16 in the quarter. This benefit was partially offset by product cost impacts from increased freight and warehousing costs, operating inefficiencies as we finalize the network transition as part of Project Momentum, and planned strategic pricing and promotional investments noted above.

Current wording

Adjusted Gross margin improvement in the third fiscal quarter of 2025 was benefited by the FY25 production credit of $33.9 as well as Project Momentum which delivered savings of approximately $12 in the quarter. These benefits were partially offset by product cost impacts from increased freight and warehousing, production inefficiencies associated with rebalancing our network, planned strategic pricing and promotional investments noted above, and a slightly lower margin on the APS NV business.

Previous wording

Adjusted Gross margin improvement for the six months ended March 31, 2025 was largely driven by Project Momentum, which delivered savings of approximately $32 in the period and lower product materials costs. This benefit was partially offset by product cost impacts from increased freight and warehousing costs, operating inefficiencies as we finalize the network transition as part of Project Momentum, and planned strategic pricing and promotional investments noted above.

Current wording

Adjusted Gross margin improvement for the nine months ended June 30, 2025 was largely driven by Project Momentum, which delivered savings of approximately $44 in the period, as well as the FY25 production credits of $33.9. This benefit was partially offset by product cost impacts from increased freight and warehousing costs, operating inefficiencies associated with rebalancing our network as a part of Project Momentum, planned strategic pricing and promotional investments noted above, and a slightly lower margin on the APS NV business.

Previous wording

SG&A was $136.0 in the second fiscal quarter of 2025, or 20.5% of Net sales, as compared to $122.5, or 18.5% of Net sales, in the prior year period. Included in SG&A during the second fiscal quarter of 2025 and 2024 were acquisition and integration costs of $2.3 and $0.7, respectively, and restructuring and related costs of $9.2 and $7.9, respectively. Excluding these restructuring and related costs and acquisition and integration costs, adjusted SG&A was $124.5, or 18.8% of Net sales in the second fiscal quarter of 2025, as compared to $113.9, or 17.2% of Net sales in the prior year period. The year-over-year dollar increase was primarily driven by investment in digital transformation and growth initiatives, as well as increased legal fees. The increase was partially offset by Project Momentum savings of approximately $4 in the quarter.

Current wording

SG&A was $128.3 in the third fiscal quarter of 2025, or 17.7% of Net sales, as compared to $129.6, or 18.5% of Net sales, in the prior year period. Included in SG&A during the third fiscal quarter of 2025 and 2024 were acquisition and integration costs of $1.3 and $1.4, respectively, and restructuring and related costs of $5.1 and $9.8, respectively and a current year credit related to litigation matters of $1.7. Excluding these items, adjusted SG&A was $123.6, or 17.0% of Net sales in the third fiscal quarter of 2025, as compared to $118.4, or 16.9% of Net sales in the prior year period. The year-over-year dollar increase was primarily driven by increased SG&A from the APS NV business of $4.5, investment in digital transformation and growth initiatives, as well as increased legal fees. The increase was partially offset by Project Momentum savings of approximately $3 in the quarter.

Previous wording

SG&A was $267.3 in the six months ended March 31, 2025, or 19.2% of Net sales, as compared to $250.6, or 18.2% of Net sales, in the prior year period. Included in SG&A during the six months ended March 31, 2025 and 2024 were acquisition and integration costs of $3.5 and $1.4, respectively, and restructuring and related costs of $20.1 and $17.5, respectively. Excluding these restructuring and related costs and acquisition and integration costs, adjusted SG&A was $243.7, or 17.5% of Net sales in the six months ended March 31, 2025, as compared to $231.7, or 16.8% of Net sales in the prior year period. The year-over-year dollar increase was primarily driven by investment in digital transformation and growth initiatives, increased depreciation expense related to these digital transformation initiatives, as well as increased legal fees. The increase was partially offset by Project Momentum savings of approximately $7 in the period.

Current wording

SG&A was $395.6 in the nine months ended June 30, 2025, or 18.7% of Net sales, as compared to $380.2, or 18.3% of Net sales, in the prior year period. Included in SG&A during the nine months ended June 30, 2025 and 2024 were acquisition and integration costs of $4.8 and $2.8, respectively, and restructuring and related costs of $25.2 and $27.3, respectively, and a current year credit related to litigation matters of $1.7. Excluding these items, adjusted SG&A was $367.3, or 17.3% of Net sales in the nine months ended June 30, 2025, as compared to $350.1, or 16.8% of Net sales in the prior year period. The year-over-year dollar increase was primarily driven by increased SG&A from the APS NV business of $4.5, investment in digital transformation and growth initiatives, increased depreciation expense related to these digital transformation initiatives, as well as increased legal fees. The increase was partially offset by Project Momentum savings of approximately $10 in the period.

Previous wording

Advertising and sales promotion expense (A&P) was $20.8, or 3.1% of net sales, in the second fiscal quarter of 2025, as compared to $21.4, or 3.2% of Net sales, in the second fiscal quarter of 2024. A&P was $74.2, or 5.3% of net sales, in the six months ended March 31, 2025, as compared to $68.4, or 5.0% of Net sales, in the prior year comparative period. The year-over-year increase in the first half of the year was primarily driven by increased investment behind our brands and business to support the key holiday season.

Current wording

Advertising and sales promotion expense (A&P) was $43.4, or 6.0% of net sales, in the third fiscal quarter of 2025, as compared to $37.9, or 5.4% of Net sales, in the third fiscal quarter of 2024. A&P was $117.6, or 5.5% of net sales, in the nine months ended June 30, 2025, as compared to $106.3, or 5.1% of Net sales, in the prior year comparative period. The dollar increase in the third fiscal quarter was primarily driven by investment in the launch of our Podium Series. The year-over-year increase was primarily driven by increased investment behind our brands, including the launch of our Podium Series, and to support the key holiday season.

Previous wording

R&D was $8.1, or 1.2% of Net sales, for the quarter ended March 31, 2025, as compared to $7.9, or 1.2% of Net sales, in the prior year comparative period. R&D was $16.1, or 1.2% of Net sales, for the six months ended March 31, 2025, as compared to $15.7, or 1.1% of Net sales, in the prior year comparative period.

Current wording

R&D was $8.2, or 1.1% of Net sales, for the quarter ended June 30, 2025, as compared to $7.4, or 1.1% of Net sales, in the prior year comparative period. R&D was $24.3, or 1.1% of Net sales, for the nine months ended June 30, 2025, as compared to $23.1, or 1.1% of Net sales, in the prior year comparative period.

Previous wording

Interest expensewas $38.0 for the second fiscal quarter of 2025 compared to $38.7 for the prior year comparative period. For the six months ended March 31, 2025 interest expense was $75.0 as compared to $79.4 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.

Current wording

Interest expensewas $39.0 for the third fiscal quarter of 2025, essentially flat compared to $38.5 for the prior year comparative period. For the nine months ended June 30, 2025 interest expense was $114.0 as compared to $117.9 for the prior year comparative period. The lower interest expense was due to a lower average outstanding debt balance in the current year.

Previous wording

Loss on extinguishment/modification of debt was $5.2 and $0.4 for the second fiscal quarters of 2025 and 2024, respectively, and $5.3 and $0.9 for the six months ended March 31, 2025 and 2024, respectively. During March 2025, the Company refinanced and extended the maturity of both its $760 Term Loan and $500 Revolving Credit Facility resulting in the majority of the loss on extinguishment/modification in fiscal 2025. The prior year amount was related to early repayments on the previously outstanding term loan.

Current wording

Loss on extinguishment/modification of debt was $1.2 for the third fiscal quarter of 2024, and $5.3 and $2.1 for the nine months ended June 30, 2025 and 2024, respectively. During March 2025, the Company refinanced and extended the maturity of both its $760 Term Loan and $500 Revolving Credit Facility resulting in the majority of the loss on extinguishment/modification in fiscal 2025. The prior year amount was related to early repayments on the previously outstanding term loan and term loan reprice completed during the prior year.

Previous wording

Other items, netwas a benefit of $0.2 and an expense of $5.5 for the second fiscal quarters of 2025 and 2024, respectively. Other items, net was a benefit of $5.2 and a expense of $24.5 for the six months ended March 31, 2025 and 2024, respectively.

Current wording

Other items, netwas an expense of $1.9 and a benefit of $5.0 for the third fiscal quarters of 2025 and 2024, respectively. Other items, net was a benefit of $3.3 and a expense of $19.5 for the nine months ended June 30, 2025 and 2024, 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 $1.0 and $22.0 of exchange and related losses for the three and six months ended March 31, 2024, respectively, in Other items, net on the Consolidated (Condensed) Statement of Earnings.

Current wording

(1) Foreign currency exchange loss/(gain) 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, respectively, in Other items, net on the Consolidated (Condensed) Statement of Earnings.

Previous wording

The effective tax rate on a year to date basis was 23.9% as compared to 33.8% in the prior year. The prior year rate was driven by the charges from the December 2023 Argentina Reform which did not result in a statutory tax benefit. Excluding the impact of restructuring and related costs, network transition costs, acquisition and integration costs, the Loss on extinguishment/modification in debt and the December 2023 Argentina Economic Reform, the year to date adjusted effective tax rate was 23.9% as compared to 23.6% in the prior year. The higher current year rate is driven by the higher foreign rate differential compared to the prior year.

Current wording

The effective tax rate on a year to date basis was expense of 11.5% as compared to 66.7% in the prior year. The current year rates are impacted by the retroactive and current year production credits recorded in the current period. The prior year rate was driven by the charges from the December 2023 Argentina Reform which did not result in a statutory tax benefit as well as the non-cash intangible impairment.