Energizer Group Limited Company accounts

COMPANY REGISTRATION NUMBER: 3937798

Energizer Group Limited

Annual Report

30 September 2022

Energizer Group Limited

Financial Statements

Year ended 30 September 2022

Contents	Page

Strategic report	1

Directors' report	10

Independent auditors' report to the members of Energizer Group Limited	13

Statement of comprehensive income	17

Statement of financial position	18

Statement of changes in equity	19

Notes to the financial statements	20

Energizer Group Limited

Strategic Report

Year ended 30 September 2022

Business review

The company acts in two capacities: - as Energizer's European Entrepreneurial Principal. In this role the company has entered into an agreement with Energizer Trading Limited (ETL) whereby the company provides ETL with commercial and administrative advisory services in exchange for an entrepreneurial rate of return (management services fee), and ETL provides Warehouse and Distribution services for the group. The company received £40.1m (2021: £36.3m) from ETL under this agreement, which is included in Other Operating Income (see n ote 6). - as a limited risk distributor (LRD) of ETL for the sale and distribution of household and specialty batteries, portable lights and automotive care products in the UK. The external commercial environment is expected to remain competitive in the next financial year. The company continues to seek opportunities to increase sales, market share, profit and maximise future opportunities. On 30 September 2021 the company entered into an asset transfer agreement with Custom Accessories Europe Limited (CAE), a fellow group company whose principal activity was the design, development and distribution of automotive accessories and and related products, whereby the company agreed to purchase the non distribution trade and assets from CAE effective 1 October 2021 The main KPIs used by the directors to assess the performance and position of the company are the UK Sales, the Operating Profit of the company and the Days Sales Outstanding (DSO) based on the Sales. Sales have increased versus the prior year by 5% from £58.2m to £61.1m. Gross profit has increased by £2.5m (15%) as a result of increased sales and lower product costs. This gross profit increase has been partially offset by a £1.1m (10%) increase in overhead costs related to the LRD businesses. The resulting Operating Profit from the LRD business has increased by £1.1m versus the prior year. The management fee income from ETL has increased by £3.8m but this has been partially offset by a £2.8m increase in regional administrative expenses, contributing a net £1.0m increase in operating profit. New intercompany royalty agreements have been put in place with Energizer Brands LLC and Energizer Auto Sales Inc this year and the company has paid £12.3m royalties for the European use of trademarks owned by the US companies, these royalties are included in administrative expenses. The company has paid these royalties in its role as the European Entrepreneurial Principal. The aforementioned factors have resulted in a net decrease of £10.2m in operating profit before impairments of intangible assets and foreign exchange gains and losses from an operating profit of £9.8m in the prior year to an operating loss of £0.4m in the current year. Favourable foreign exchange gains in the year increased operating profit by £0.8m while unfavourable foreign exchange losses in the prior year reduced operating profit by £0.4m The company has written off £53.3m of goodwill related to its Micropower Hearing Aid Battery (HAB) business in the year (see below for further details) and a further £3.0m of Automotive Care Product intangible assets. These intangible asset impairments have resulted in the company reporting an operating loss in the current year of £55.9m compared to an operating profit of £9.4m in the prior year. These one-off charges are not expected to be repeated in future years. DSO are calculated based on the average quarter end trade receivables net of VAT and accrued trade investment over the trailing four quarters divided by the average sales over a trailing twelve-month period. Due to the high level of trade investment particularly towards the year end, DSO is typically negative. DSOs have declined from -25 days at September 2021 to -32 days at September 2022. The company reported net current liabilities of £94.3m (2021: £80.3m) and net liabilities of £5.2m at the year end (2021: net assets of £58.7m). The swing from net assets to net liabilities was mainly due to the goodwill impairment loss in the year (see below) as well as a reduction in the pension scheme surplus and an increase in amounts owed to group undertakings as a result of the new royalty agreements described above. To ensure the company can adequately service its debts, the directors have secured from the ultimate parent company, Energizer Holdings Inc. a legally binding letter of support expiring in January 2025. Whilst it is expected that the company can secure a similar letter of support beyond the expiration period, the directors are reviewing debt/equity position as well as the wider structure of the UK group of companies to restore the company to long term profitability including meeting its long term working capital needs.

Micropower hearing aid battery business impairment

Recent historical trends have shown an increasing shift in consumer demand towards hearing aid devices with built in rechargeable batteries compared to traditional devices with replaceable batteries. As a result of these trends management have performed a detailed impairment review of the carrying value of the goodwill related to the Micropower Hearing Aid Battery (HAB) business that the company acquired in November 2019. Management's projections for the next 5 years, based on this historical trend and external data sources, show a continued volume decline in the global micropower hearing aid battery category in the range of 4.5% to 6.5% a year for the next 5 years, stabilising in the sixth year. These projected category declines have been used to perform a net present value calculation of future cashflows that the company expects to achieve from the HAB business. In the NPV calculation the annual decline percentages have been increased by one percentage point a year to account for sensitivity in the forecasts and no growth or decline has been included in the terminal year. As a result of this impairment review £53.3m has been written off at the year end. Sensitivity analysis shows that a change in the WACC of +/-1% would have impacted the impairment loss by +/-£1m.

Future activities

Other than the decline in the cashflows from the HAB business described above the directors do not anticipate any significant changes to the activities of the company in the near future.

Financial risk management

The credit, liquidity and cash flow risks are deemed low due to the ability to obtain financing from group undertakings. The company has implemented policies that require appropriate credit checks on potential customers before sales are made. Treasury and financial risk management are conducted at a corporate level and further details can be found in section 1A of Energizer Holdings Inc.'s 2022 annual report, which does not form part of this report.

Principal risks and uncertainties

The company is exposed to a variety of risks, some of which are inherent in our industry and others of which are more specific to our own businesses. The discussion below addresses the material factors, of which we are currently aware, that could affect, and in certain cases have affected, our businesses, results of operations and financial condition.

Other factors not discussed below or elsewhere in this Annual Report could also adversely affect our businesses, results of operations and financial condition. Therefore, the risk factors below should not be considered a complete list of potential risks that we may face.

Global economic conditions, including the conditions resulting from the COVID-19 pandemic, and actions taken by our customers, suppliers, other business partners and governments in markets in which we compete might materially and negatively impact us.

The COVID-19 pandemic has caused considerable volatility to global economic conditions and the economies in regions in which we conduct business. While we experienced reduced demand for certain of our consumer products as a result of the pandemic, demand increased for other products. In the future, our business might be adversely affected in a material way by lower consumer demand as a result of recessionary economic conditions, including after the direct impact of the COVID-19 pandemic has subsided. In response to unfavourable economic conditions, there could be a reduction in discretionary spending, which may lead to reduced net sales or cause a shift in our product mix from higher-margin to lower-margin product offerings or a shift of purchasing patterns to lower cost options such as "private label" brands sold by retail chains or price brands. This shift could drive the market towards lower margin products or force us to reduce prices for our products in order to compete. Similarly, our retailer customers could reduce their inventories, shift to different products or require us to lower our prices to retain the shelf placement of our products. Conversely, rapid increases in demand as a result of improving economic conditions could lead to supply chain challenges.

Uncertain economic and financial market conditions may also adversely affect the financial condition of our customers, suppliers and other business partners. Any significant decrease in customers' purchases of our products or our inability to collect accounts receivable resulting from an adverse impact of the global markets on customers' financial condition could have a material adverse effect on our business, financial condition and results of operations.

Competition in our product categories might hinder our ability to execute our business strategy, achieve profitability, or maintain relationships with existing customers.

Most of our products compete with other widely advertised, promoted and merchandised brands within each product category. The categories in which we operate are mature and highly competitive, with a limited number of large manufacturers competing for consumer acceptance, limited retail shelf space and e-commerce opportunities. Because of the highly competitive environment in which we operate, our customers, including online retailers, frequently seek to obtain pricing concessions or better trade terms, resulting in either a reduction of our margins or the loss of distribution to lower-cost competitors.

Competition in our product categories is based upon brand perceptions, innovation, product performance, customer service and price. Our ability to compete effectively is, and in the future could be, affected by a number of factors, including:

- Certain of our competitors have substantially greater financial, marketing, research and development, and other resources and greater market share in certain segments than we do, which could provide them with greater scale and negotiating leverage with retailers and suppliers. These competitors may be able to spend more aggressively on advertising and promotional activities, introduce competing products more quickly and respond more effectively to changing business and economic conditions than we can.

- Our competitors may have lower production, sales and distribution costs, and higher profit margins.

- Our competitors have obtained, and may in the future be able to obtain, exclusivity or sole source at particular retailers or favourable in-store placement.

- We may lose market share to private label brands that are typically sold at lower prices and compete with our products in certain categories.

Changes in the retail environment and consumer preferences could adversely affect our business

Our sales have historically been largely concentrated in the traditional retail grocery and mass retail outlets. We cannot, however, predict how the retail environment will evolve Alternative retail channels, including hard discounters, e-commerce retailers and subscription services, have become more prevalent, and retailers are increasingly selling consumer products through such channels. In addition, a growing number of alternative sales channels and business models, such as niche brands, native online brands, private label and store brands, direct-to-consumer brands and channels and discounter channels, continue to evolve. In particular, the growing presence of, and increasing sales through, e-commerce retailers have affected, and may continue to affect, consumer preferences (as consumers increasingly shop online) and market dynamics, including any pricing pressures for consumer goods as retailers face added costs to build their e-commerce capacity. These trends have been magnified due to the COVID-19 pandemic. Although we are engaged in e-commerce with respect to many of our products, if we are not successful in responding to these competitive factors, changing consumer preferences and market dynamics or expanding sales through evolving sales channels, especially e-commerce retailers, hard discounters and other alternative retail channels, our business, financial condition and results of operations may be negatively impacted.

We must successfully manage the demand, supply, and operational challenges brought about by the COVID-19 pandemic and any other disease outbreak, including epidemics, pandemics, or similar widespread public health concerns.

Our operations are impacted by consumer spending levels, impulse purchases, the availability of our products to retail and our ability to manufacture, store and distribute products to our customers and consumers in an effective and efficient manner. The fear of exposure to or actual effects of a disease outbreak or similar widespread public health concern, such as COVID-19, negatively impacted portions of our business in fiscal 2021 and could continue to negatively impact our overall business, financial position and financial results. These impacts may include, but are not limited to:

- Significant reductions, shifts or fluctuations in demand for one or more of our products, which may be caused by, among other things:

- a decrease in consumer traffic in brick-and-mortar stores across all our major markets;

- the temporary inability of our consumers to purchase our products due to illness, quarantine, other

travel restrictions, or financial hardship;

- shifts in demand away from one or more of our premium products to lower priced value or private

label products and lower demand in our discretionary product categories;

- stockpiling activity by consumers, which if prolonged, further increase the complexity of our

operations planning and financial forecasting and adversely impact our results of operations;

- significant reductions in the availability of one or more of our products as a result of retailers,

common carriers or other shippers modifying restocking, fulfillment and shipping practices; or

- shifts, fluctuations, or cancellation of orders due to the impact on customers' operations, including

the possibility of temporary or permanent closure.

- Inability to meet our customers' needs due to disruptions in our manufacturing and supply chain arrangements caused by the loss or disruption of essential manufacturing and supply chain elements, such as raw materials or other finished product components, transportation, workforce, or other manufacturing and distribution capability. In addition, we may incur higher costs for transportation, workforce and distribution capability in order to maintain the surety of supplying product to our customers;

- Failure of third parties upon which we rely, including our suppliers, contract manufacturers, distributors, contractors and commercial banks, to meet their obligations to us to meet those obligations in a timely manner, which may be caused by their own financial or operational difficulties and may adversely impact our operations, liquidity and financial results; and

- Significant changes in the political and regulatory landscape in the markets in which we sell or distribute our products, which may include, but are not limited to, restrictions on international trade, governmental or regulatory actions, closures or other restrictions that limit or suspend our or our third-party partners' or customers' operating and/or manufacturing capabilities, including operations necessary for the production, distribution, sale, and support of our products, which could adversely impact our results.

Loss of reputation of our leading brands or failure of our marketing plans could have an adverse effect on our business.

We depend on the continuing reputation and success of our brands. Maintaining a strong reputation with consumers, customers and trade and other third-party partners is critical to the success of our business. Negative publicity about us or our brands, including product safety, quality, efficacy, environmental impacts (including packaging, energy and water use, matters related to climate and waste management) and other sustainability or similar issues, whether real or perceived, could occur and could be be widely and rapidly disseminated, including through the use of social media or network sites. Our operating results could be adversely affected if any of our brands suffers damage to its reputation due to real or perceived quality issues. Any damage to our brands could impair our ability to charge premium prices for our products, resulting in the reduction of our margins or losses of distribution to lower price competitors, and adversely affect our business.

The success of our brands can suffer if our marketing plans or new product offerings do not improve, or have a negative impact on, our brands' image or ability to attract and retain consumers. Additionally, if claims made in our marketing campaigns subject us to claims and litigation alleging false advertising, which is common in our industry, such claims and litigation could damage our brand or cause us to alter our marketing plans in ways that may materially and adversely affect sales, or result in the imposition of significant damages against us. In addition, our products could face quality or safety issues, which could result in our withdrawing or recalling the product from the marketplace and may lead to decreased demand for, and sales of, such products and harm the reputation of the related brands. We also license certain of our brands to third parties, and such licenses and partnerships may create additional exposure for those brands to product safety, quality, sustainability and other concerns.

Loss of any of our principal customers could significantly decrease our sales and profitability.

A large percentage of our sales are attributable to a relatively small number of retail customers, and we may continue to derive a significant portion of our future revenues from a small number of customers. Additionally, with the growing trend towards retailer consolidation, the rapid growth of e-commerce and the integration of traditional and digital operations at key retailers, we are increasingly dependent on certain retailers. As a result, changes in the strategies of our largest customers, including a reduction in the number of brands they carry, a shift of shelf space to private label or competitors' products or a decision to lower pricing of consumer products, including branded products, may harm our net sales or margins, and reduce our ability to offer new, innovative products to consumers. Furthermore, these large, consolidated companies could also exert additional competitive pressure on our other customers, which could in turn lead to similar demands on us. If we cease doing business with a significant customer or if we experience a significant reduction in net sales to a key customer, it could have a material adverse effect on our business, financial condition and results of operations.

Customers could reduce their purchasing levels or cease buying products from us at any time and for any reason. If we do not effectively respond to the demands of our customers, they could decrease their purchases from us, causing our net sales and net earnings to decline.

A failure of a key information technology system could adversely impact our ability to conduct business.

We rely extensively on information technology systems, including some that are managed by third-party service providers, in order to conduct business. These systems include, but are not limited to, programs and processes relating to internal and external communications, ordering and managing materials from suppliers, converting materials to finished products, shipping products to customers, processing transactions, summarising and reporting results of operations, and complying with regulatory, legal or or tax requirements. These information technology systems could be damaged or cease to function properly due to the poor performance or failure of third-party service providers, catastrophic events, power outages, security breaches, network outages, failed upgrades or other similar events. If our business continuity plans do not effectively resolve such issues on a timely basis, we may suffer interruptions in conducting our business, which may adversely impact our operating results.

We rely significantly on information technology and any inadequacy, interruption, theft or loss of data, malicious attack, integration failure, failure to maintain the security, confidentiality or privacy of sensitive data residing on our systems or other security failure of that technology could harm our ability to effectively operate our business and damage the reputation of our brands.

Our systems and networks, as well as those of our retailer customers, suppliers, service providers, and banks, have and may in the future become the target of cyberattacks or information security breaches, which in turn could result in the unauthorised release and misuse of confidential or proprietary information about our company, employees, customers or consumers, as well as disrupt their and our operations or damage their and our facilities or those of third parties. We have seen an increase in the number of such attacks since a large number of our employees began working remotely. Furthermore, such attacks may originate from nation states or attempts by outside parties, hackers, criminal organisations, or other threat actors. Any significant breaches or breakdowns of such databases or systems could result in significant costs, including costs to investigate or remediate. While we have taken steps to maintain and enhance cyber security and address these risks and uncertainties by implementing security technologies, internal controls, network and data centre resiliency, redundancy and recovery processes, upgrading our remote work environment and by obtaining insurance coverage, these measures may be inadequate. In addition, such incidents could result in unauthorised disclosure and misuse of material confidential information. Cyber threats are becoming more sophisticated, are constantly evolving and are being made by groups and individuals with a wide range of expertise and motives, and this increases the difficulty of detecting and successfully defending against them. Data breaches or theft of personal information we and our third-party service providers collect, as well as company information and assets, have occurred in the past and may occur in the future and the failure to remediate such intrusions may adversely affect our reputation and financial condition.

Energizer's business is subject to regulation.

The manufacture, packaging, labelling, storage, distribution, advertising and sale of our products are subject to extensive regulation. New or more restrictive regulations or more restrictive interpretations of existing regulations could have an adverse impact on our business. Legislative and regulatory changes by taxing authorities have an impact on our effective tax rate, and we may be subject to additional costs arising from new or changed regulations, including those relating to health care and energy. Additionally, a finding that we are in violation of, or not in compliance with, applicable laws or regulations could subject us to material civil remedies, including fines, damages, injunctions or product recalls, or criminal sanctions. Even if a claim is unsuccessful, is not merited or is not fully pursued, the negative publicity surrounding such assertions could jeopardise our reputation and brand image and have a material adverse effect on our businesses, as well as require resources to to rebuild our reputation.

We must comply with various environmental laws and regulations including those relating to the handling and disposal of solid and hazardous wastes, recycling of batteries, and the remediation of contamination associated with the use and disposal of hazardous substances. A release of such substances due to accident or an intentional act could result in substantial liability to governmental authorities or to third parties. We have incurred, and will continue to incur, capital and operating expenses and other costs in complying with environmental laws and regulations, including remediation costs relating to our current and former properties and third-party waste disposal sites. We could become subject to additional environmental liabilities in the future that could cause a material adverse effect on our results of operations or financial condition.

Changes in production costs, including raw material prices, have adversely affected, and in the future could erode, our profit margins and negatively impact operating results.

Pricing and availability of raw materials, energy, shipping and other services needed for our business can be volatile due to general economic conditions, labour costs, production levels, import duties and tariffs and other factors beyond our control, including inflation. There is no certainty that we will be able to offset future cost increases. This volatility can significantly affect our production cost and may, therefore, have a material adverse effect on our business, results of operations and financial condition.

Volatility, availability and increases in the cost of raw materials and transportation have negatively impacted, and are likely to continue to negatively impact, the Company's results of operations. We believe commodity price and other cost increases and volatility, especially due to the COVID-19 pandemic, could continue in the future. If such increases occur or exceed our estimates and we are not able to increase the prices of our products or achieve cost savings to offset such cost increases, our results of operation would be harmed. In addition, even if we increase the prices of our products in response to increases in the cost of commodities or other cost increases, we may not be able to sustain our price increases. Sustained price increases may lead to declines in volume as competitors may not adjust their prices or customers may decide not to pay the higher prices, which could lead to sales declines and loss of market share. Our projections may not accurately predict the volume impact of of price increases, which could adversely affect our business, financial condition and results of operations.

Energizer's manufacturing facilities or supply channels may be subject to disruption from events beyond our control.

Operations of the ultimate parent company's manufacturing and packaging facilities worldwide may be subject to disruption for a variety of reasons, including work stoppages, cyber-attacks and other disruptions in information technology systems, demonstrations, disease outbreaks or pandemics acts of war or conflicts (including the ongoing conflict in Ukraine),, terrorism, fire, earthquakes, flooding or other natural disasters, disruptions in in logistics, loss or impairment of key manufacturing sites, supplier capacity constraints, raw material and product quality or safety issues, industrial accidents or other occupational health and safety issues, availability of raw materials, and other regulatory issues, trade disputes between countries in which we have operations, such as the U.S. and China. There is also a possibility that third-party manufacturers, which produce a significant portion of certain of our products, could discontinue production with little or no advance notice, or experience financial problems or problems with product quality or timeliness of product delivery, resulting in manufacturing delays or disruptions, regulatory sanctions, product liability claims or consumer complaints. If a major disruption were to occur, it could result in delays in shipments of products to customers or suspension of operations. We maintain business interruption insurance to potentially mitigate the impact of business interruption, but such coverage may not be sufficient to offset the financial or reputational impact of an interruption.

We may not be able to attract, retain and develop key personnel.

Our future performance depends in significant part upon the continued service of our executive officers and other key personnel. The loss of the services of one or more of our executive officers or other key employees could have a material adverse effect on our business, prospects, financial condition and results of operations. Our success also depends on our continuing ability to attract, retain and develop highly qualified personnel. Competition for such personnel is intense, and there can be no no assurance that we can retain and motivate our key employees or attract and retain other highly qualified personnel in the future.

S172 statement

Sustainability at Energizer

Energizer Group Limited is part of the global Energizer Household and Autocare products Group and is a 100% owned subsidiary of Energizer Holdings Inc. (EHI), the ultimate parent company. The strategies of the company are aligned with the strategies of EHI.

During 2021 EHI introduced a new purpose statement, 'We responsibly create products to make lives easier and more enjoyable', and also created a formal sustainability program covering environmental, social and governance (ESG) issues; appointed a global head of sustainability; created a cross functional sustainability team; and developed a long-term sustainability strategy that runs through 2030 and beyond.

The sustainability team conducted an extensive materiality assessment to better understand the sustainability impacts, risks and opportunities for Energizer Holdings across the organisation. Based on the results of this assessment three key focus areas were identified: Sustainable Packaging, Product Sustainability & Safety, Climate & Energy. The team developed multistep plans with goals and timelines to ensure meaningful progress is made toward these goals.

Product sustainability and Environmental responsibility are two of the five pillars of our ESG commitment alongside the remaining three pillars of Social responsibility, Community impact and Corporate governance.

A full sustainability report can be found on Energizer Holdings Inc.'s website.

Identifying our stakeholders

Engaging with a wide range of stakeholders is essential to understanding, anticipating and taking action on risks and opportunities related to sustainability. Our stakeholders include our customers, consumers, colleagues, investors, governments and regulators, trade associations, non-governmental organisations (NGOs) and communities.

For our customers, our ambition is to be a valued supplier across the markets we operate in. We work with them to help them meet consumer needs and support them in achieving their own sustainability goals.

Energizer reaches consumers through many channels, including through our products, in-store, e.commerce and through our brand marketing communications. We are committed to providing products that can help consumers lead more sustainable lives, with the transparency they expect.

We regularly engage with consumers through market research to understand their priorities.

Our colleagues are a core stakeholder group for Energizer. Without them, we wouldn't have a business. We aim to retain and attract top talent in the industry, support them through learning and development opportunities, and provide a work environment where everyone is treated with respect, receives fair compensation and benefits, has work-life flexibility and has a manager who helps them to grow and thrive. Our two-way feedback process allows us to keep an open dialogue with our team members and ensure they have a positive, safe and fulfilling experience of working at Energizer.

We regularly engage with existing and potential shareholders and investors to gauge their sustainability priorities. This helps build mutual understanding and provides a foundation for progress, so that we are focusing on the issues that they care about.

Governments and regulators are a core stakeholder group for Energizer as they set the compliance framework for our business. Our company guidelines on engaging with governments are included in our Code of Conduct.

We work with our suppliers and strive to ensure that the components and materials that go into our products are sourced responsibly. Our requirements from our suppliers are clearly stated in our Supplier Code of Conduct and we actively seek relationships with suppliers that share these values and that promote high standards within their own supply chains.

Our business contributes to the economic livelihoods of many people and communities across our value chain. We create direct and indirect employment opportunities, and we make direct contributions through regional and community activities.

We are members of many industry, business and trade associations whose activities are related to Energizer's brands and operations. These associations provide a forum to have a voice within the broader industry, while providing a platform for joint research, issue monitoring and sharing of best practices. For a list of trade associations where Energizer has made contributions see the Corporate Governance pillar section in our ESG commitment summary.

We engage with NGOs and not-for-profits to help us better understand key issues, stay on top of best practices and achieve certification in some of the sustainability areas that are key priorities for us.

This report was approved by the board of directors on 26 October 2023 and signed on behalf of the board by:

Mrs S Hampton

Director

Registered office:

Sword House

Totteridge Road

High Wycombe

Bucks

England

HP13 6DG

Energizer Group Limited

Directors' Report

Year ended 30 September 2022

The directors present their report and the financial statements of the company for the year ended 30 September 2022 .

Directors

The directors who served the company during the year and up to the date of signing the financial statements were as follows:

Mrs K Dugan	(Appointed 24 January 2022)
Mrs K Gabrielson	(Appointed 24 January 2022)
Mrs S Hampton	(Appointed 24 January 2022)
Mr B Angellette	(Resigned 24 January 2022)
Mr J Drabik	(Resigned 24 January 2022)

Dividends paid and payable

The directors do not recommend the payment of a dividend.

Streamlined energy and carbon reporting

	Unit	2022	2021
Emissions resulting from activities for which the company is responsible	tCO2e	15	61
Emissions resulting from the purchase of electricity by the company for its own use	tCO2e	135	307
		----	----
Total emissions	tCO2e	150	368
Total energy consumption	kWh	719,218	1,780,703
Intensity metric - tCO2e / employee		1.03	2.73
		---------	------------

Methodologies for energy and emissions calculations

The company's ultimate parent uses a global ESG data management software to assist in traceability, record keeping and analysis of data. This software uses the Greenhouse Gas Protocol Methodology by the World Resources Institute.

Principal measures taken to increase energy efficiency

No specific actions have been taken by the company during the year to reduce emissions.

Qualifying third party indemnity provisions

During the year qualifying third party indemnity provisions for the directors were provided by Energizer Holdings Inc., the ultimate parent company. Such qualifying indemnity provisions remain in force as at the date of approval of the financial statements.

Going concern

As the company had net current liabilities of £94.3m at the year end (2021: net current liabilities of £80.3m), the directors have obtained a legally binding letter of support from the ultimate parent company to ensure it can service its debts and continue to operate as a going concern. This letter states that:

The Parent will provide financial support to the Company such that the Company is able to operate as a going concern and to settle its liabilities as they fall due. This financial support will include:

- Not seeking the repayment of amounts advanced to the Company by the Parent and/or other members of the Parent group unless adequate alternative financing has been secured by the Company; and

- Advancing further amounts to the Company as required by the Company.

The company's forecasts and projections, taking account of reasonably possible changes in trading performance, show that the company should be able to operate within the level of its current facilities.

The company therefore continues to adopt the going concern basis in preparing its financial statements.

Disclosure of information in the strategic report

Disclosure of the future activities of the company, the directors' assessment of the company's principal risks and uncertainties and financial risk management as well as the S172 Statement are set out in the Strategic Report.

Directors' responsibilities statement

The directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulation. Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have prepared the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards, comprising FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland", and applicable law). Under company law, directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and of the profit or loss of the company for that period. In preparing the financial statements, the directors are required to: - select suitable accounting policies and then apply them consistently; - state whether applicable United Kingdom Accounting Standards, comprising FRS 102 have been followed, subject to any material departures disclosed and explained in the financial statements; - make judgements and accounting estimates that are reasonable and prudent; and - prepare the financial statements on the going concern basis unless it is inappropriate to presume that the company will continue in business. The directors are responsible for safeguarding the assets of the company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. The directors are also responsible for keeping adequate accounting records that are sufficient to show and explain the company's transactions and disclose with reasonable accuracy at any time the financial position of the company and enable them to ensure that the financial statements comply with the Companies Act 2006. Directors' confirmations In the case of each director in office at the date the Directors' Report is approved: - so far as the director is aware, there is no relevant audit information of which the company's auditors are unaware; and - they have taken all the steps that they ought to have taken as a director in order to make themselves aware of any relevant audit information and to establish that the company's auditors are aware of that information.

Independent auditors

The auditors PricewaterhouseCoopers LLP have indicated their willingness to continue in office and a resolution concerning their reappointment will be proposed at the next board meeting.

This report was approved by the board of directors on 26 October 2023 and signed on behalf of the board by:

Mrs S Hampton

Director

Registered office:

Sword House

Totteridge Road

High Wycombe

Bucks

England

HP13 6DG

Energizer Group Limited

Independent Auditors' Report to the Members of Energizer Group Limited

Year ended 30 September 2022

Report on the audit of the financial statements

Opinion In our opinion, Energizer Group Limited's financial statements: - give a true and fair view of the state of the company's affairs as at 30 September 2022 and of its loss for the year then ended; - have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards, including FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland", and applicable law); and - have been prepared in accordance with the requirements of the Companies Act 2006. We have audited the financial statements, included within the Annual Report, which comprise: the statement of Financial Position as at 30 September 2022; the Statement of Comprehensive Income and the Statement of Changes in Equity for the year then ended; and the notes to the financial statements, which include a description of the significant accounting policies.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) ("ISAs (UK)") and applicable law. Our responsibilities under ISAs (UK) are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion. Independence We remained independent of the company in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, which includes the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements.

Conclusions relating to going concern

Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the company's ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue.

In auditing the financial statements, we have concluded that the directors' use of the going concern basis of accounting in the preparation of the financial statements is appropriate.

However, because not all future events or conditions can be predicted, this conclusion is not a guarantee as to the company's ability to continue as a going concern.

Our responsibilities and the responsibilities of the directors with respect to going concern are described in the relevant sections of this report.

Reporting on other information

The other information comprises all of the information in the Annual Report other than the financial statements and our auditors' report thereon. The directors are responsible for the other information. Our opinion on the financial statements does not cover the other information and, accordingly, we do not express an audit opinion or, except to the extent otherwise explicitly stated in this report, any form of assurance thereon. In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit, or otherwise appears to be materially misstated. If we identify an apparent material inconsistency or material misstatement, we are required to perform procedures to conclude whether there is a material misstatement of the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report based on these responsibilities. With respect to the Strategic report and Directors' Report, we also considered whether the disclosures required by the UK Companies Act 2006 have been included. Based on our work undertaken in the course of the audit, the Companies Act 2006 requires us also to report certain opinions and matters as described below.

Strategic report and directors' report

In our opinion, based on the work undertaken in the course of the audit, the information given in the Strategic report and Directors' Report for the year ended 30 September 2022 is consistent with the financial statements and has been prepared in accordance with applicable legal requirements.

In light of the knowledge and understanding of the company and its environment obtained in the course of the audit, we did not identify any material misstatements in the Strategic report and Directors' Report.

Responsibilities for the financial statements and the audit

Responsibilities of the directors for the financial statements As explained more fully in the Directors' Responsibilities Statement, the directors are responsible for the preparation of the financial statements in accordance with the applicable framework and for being satisfied that they give a true and fair view. The directors are also responsible for such internal control as they determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial statements, the directors are responsible for assessing the company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the company or to cease operations, or have no realistic alternative but to do so.

Auditors' responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue an auditors' report that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements. Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below. Based on our understanding of the company and industry, we identified that the principal risks of non-compliance with laws and regulations related to compliance with the Companies Act 2006 and the tax legislation as applicable in the UK, and we considered the extent to which non-compliance might have a material effect on the financial statements. We evaluated management's incentives and opportunities for fraudulent manipulation of the financial statements (including the risk of override of controls), and determined that the principal risks were related to posting inappropriate journal entries and management bias in accounting estimates. Audit procedures performed by the engagement team included: - Testing of journal entries for appropriateness,testing of the accounting estimates (because of the risk of management bias), and evaluating the business rationale of significant transactions outside the normal course of business; and - Inquiry and discussions with management and the company's legal team, including consideration of known or suspected instances of non-compliance with laws and regulations and fraud; - Challenging assumptions made by management in its significant accounting estimates and judgements; There are inherent limitations in the audit procedures described above. We are less likely to become aware of instances of non-compliance with laws and regulations that are not closely related to events and transactions reflected in the financial statements. Also, the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from error, as fraud may involve deliberate concealment by, for example, forgery or intentional misrepresentations, or through collusion. A further description of our responsibilities for the audit of the financial statements is located on the FRC's website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditors' report. Use of this report

This report, including the opinions, has been prepared for and only for the company's members as a body in accordance with Chapter 3 of Part 16 of the Companies Act 2006 and for no other purpose. We do not, in giving these opinions, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing.

Other required reporting

Companies Act 2006 exception reporting Under the Companies Act 2006 we are required to report to you if, in our opinion: - we have not obtained all the information and explanations we require for our audit; or - adequate accounting records have not been kept by the company, or returns adequate for our audit have not been received from branches not visited by us; or - certain disclosures of directors' remuneration specified by law are not made; or - the financial statements are not in agreement with the accounting records and returns. We have no exceptions to report arising from this responsibility.

Gregory Briggs

(Senior Statutory Auditor)

For and on behalf of

PricewaterhouseCoopers LLP

Chartered Accountants & Statutory Auditors

Watford

26 October 2023

Energizer Group Limited

Statement of Comprehensive Income

Year ended 30 September 2022

		2022	2021
Note		£000	£000
Turnover	5	61,111	58,164

Cost of sales	( 42,053)	( 41,586)
	--------	--------
Gross profit	19,058	16,578

Distribution costs		( 17,369)	( 18,181)
Administrative expenses		( 36,306)	( 29,389)
Other operating income	6	44,325	40,353
Impairment of Goodwill		( 53,312)	–
Intercompany royalties payable		( 12,291)	–
		--------	--------
Operating (loss)/profit	7	( 55,895)	9,361

Interest receivable and similar income	11	697	462
Interest payable and similar expenses	12	( 5,802)	( 5,384)
		--------	--------
(Loss)/profit before taxation		( 61,000)	4,439

Tax on (loss)/profit	13	( 210)	( 1,905)
		--------	-------
(Loss)/profit for the financial year		( 61,210)	2,534
		--------	-------

Remeasurement of the net defined benefit plan	( 3,596)	6,077
Tax relating to components of other comprehensive income	899	( 1,545)
	-------	-------
Other comprehensive income for the year	( 2,697)	4,532
	--------	-------
Total comprehensive income for the year	( 63,907)	7,066
	--------	-------

All the activities of the company are from continuing operations.

Energizer Group Limited

Statement of Financial Position

30 September 2022

	2022		2021
Note	£000	£000	£000

Fixed assets

Intangible assets	14	42,220	96,074
Tangible assets	15	1,233	462
Investments	16	41,215	41,215
		--------	---------
		84,668	137,751

Current assets

Debtors	17	55,645	61,556
Cash at bank and in hand		4,385	5,278
		--------	--------
		60,030	66,834

Creditors: amounts falling due within one year	18	( 154,353)		( 147,127)
		---------		---------
Net current liabilities			( 94,323)	( 80,293)
			--------	---------
Total assets less current liabilities			( 9,655)	57,458

Creditors: amounts falling due after more than one year	19		( 3,255)	( 9,124)

Provisions for liabilities

Taxation including deferred tax	20	( 2,586)	( 3,648)
		--------	--------
Net (liabilities)/assets excluding defined benefit pension plan asset		(15,496)	44,686

Defined benefit pension plan asset	22	10,258	13,983
		--------	--------
Net (liabilities)/assets including defined benefit pension plan asset		( 5,238)	58,669
		--------	--------

Capital and reserves

Share premium account	25	41,215	41,215
Profit and loss account		( 46,453)	17,454
		--------	--------
Total shareholders' funds		( 5,238)	58,669
		--------	--------

These financial statements were approved by the board of directors and authorised for issue on 26 October 2023 , and are signed on behalf of the board by:

Mrs S Hampton

Director

Company registration number: 3937798

Energizer Group Limited

Statement of Changes in Equity

Year ended 30 September 2022

			Share premium account	Profit and loss account	Total
			£000	£000	£000
At 1 October 2020			–	10,388	10,388

Profit for the year				2,534	2,534
Other comprehensive income for the year:
	Remeasurement of the net defined benefit plan	22	–	6,077	6,077
	Tax relating to components of other comprehensive income	13	–	( 1,545)	( 1,545)
			----	--------	--------
Total comprehensive income for the year			–	7,066	7,066

Issue of shares			41,215	–	41,215
Equity-settled share-based payments			–	289	289
Charge from ultimate parent for equity-settled share-based payments			–	(289)	(289)
			--------	--------	--------
Total investments by and distributions to owners			41,215	–	41,215

At 30 September 2021			41,215	17,454	58,669

Loss for the year				( 61,210)	( 61,210)
Other comprehensive income for the year:
	Remeasurement of the net defined benefit plan	22	–	( 3,596)	( 3,596)
	Tax relating to components of other comprehensive income	13	–	899	899
			--------	--------	--------
Total comprehensive income for the year			–	( 63,907)	( 63,907)

Equity-settled share-based payments			–	450	450
Charge from ultimate parent for equity-settled share-based payments			–	(450)	(450)
			----	----	----
Total investments by and distributions to owners			–	–	–

			--------	--------	-------
At 30 September 2022			41,215	( 46,453)	( 5,238)
			--------	--------	-------

Energizer Group Limited

Notes to the Financial Statements

Year ended 30 September 2022

1. General information

The company is a private company limited by shares, incorporated and registered in England and Wales. The address of the registered office is Sword House, Totteridge Road, High Wycombe, Bucks, HP13 6DG, England.

2. Statement of compliance

These financial statements have been prepared in accordance with applicable United Kingdom accounting standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the United Kingdom and Republic of Ireland' ('FRS 102'), and with the Companies Act 2006.

3. Accounting policies

The following accounting policies have been applied consistently throughout the period in dealing with items which are considered material in relation to the company's financial statements.

Basis of preparation

The financial statements have been prepared on a going concern basis under the historical cost convention . The financial statements are prepared in sterling, which is the functional currency of the entity. The preparation of financial statements in conformity with FRS 102 requires the use of certain critical accounting estimates. It also requires management to exercise its judgement in the process of applying the company's accounting policies. The areas involving a higher degree of judgement or complexity, or areas where assumptions and estimates are significant to the financial statements are disclosed in this note under the heading judgements and key sources of estimation uncertainty.

Going concern

As the company was in a net current liability position at the year end the directors have obtained a legally binding letter of support from the ultimate parent company to ensure it can service its debts and continue to operate as a going concern. The company's forecasts and projections, taking account of reasonably possible changes in trading performance, show that the company should be able to operate within the level of its current facilities. The company therefore continues to adopt the going concern basis in preparing its financial statements.

Disclosure exemptions

The entity satisfies the criteria of being a qualifying entity as defined in FRS 102. Its financial statements are consolidated into the financial statements of Energizer Holdings Inc. , which can be obtained from Investor relations, Energizer Holdings Inc., 533 Maryville University Drive, St Louis, MO 63141, USA. As such, advantage has been taken of the following disclosure exemptions: - from the requirement to prepare a statement of cash flows as required by paragraph 3.17(d) of FRS 102; - from the requirement to disclose the key management personnel compensation in total as required by paragraph 33.7 of FRS 102; - from the requirement to present a reconciliation of the number of shares outstanding at the beginning and end of the period as required by paragraph 4.12(a)(iv) of FRS 102; - from the requirement to present certain financial instrument disclosures, as required by sections 11 and 12 of FRS 102; and - from certain disclosures requirements in respect of share-based payments as required by paragraphs 26.18(b), 26.19-26.21 & 26.23 because the share-based payment concerns equity instruments of the ultimate parent and the equivalent disclosures are included in the consolidated financial statements of the group in which the entity is consolidated.

Consolidation

The company is a wholly owned subsidiary of Energizer Trading Limited and of its ultimate parent, Energizer Holdings Inc., a company incorporated in the USA. It is included in the consolidated financial statements of Energizer Holdings Inc. which are publicly available and can be obtained from Investor Relations, Energizer Holdings Inc., 533 Maryville University Drive, St Louis, MO 63141, USA. Therefore the company is exempt by virtue of section 401 of the Companies Act 2006 from the requirement to to prepare consolidated financial statements.

Related party transactions

The company has made use of the exemption contained in paragraph 33.1A of FRS 102, not to disclose related party transactions with other group companies, as it is a wholly owned subsidiary of a company, Energizer Holdings Inc., which prepares consolidated financial statements incorporating those transactions.

Turnover

Turnover is generated solely in the United Kingdom and represents invoiced amounts (stated net of value added tax), presented net of trade discounts and rebates, and is recognised when the goods are delivered to the customer which is when title to the product passes to the customer. The company offers rebate programs, primarily to its retail customers, designed to promote the sales of its products. Such programs require periodic payments and allowances based on estimated results and are recorded as a reduction to revenue.

Other operating income

Other operating income represents third party and intercompany royalty income, income from recharges of regional head office activities to other group companies during the year and the management service fee receivable from ETL under the management services agreement (see the strategic report for further details).

Other operating Income is recognised in the accounting period in which the services are rendered and royalty earned.

Taxation

The taxation expense represents the aggregate amount of current and deferred tax recognised in the reporting period. Tax is recognised in profit or loss, except to the extent that it relates to items recognised in other comprehensive income or directly in equity. In this case, tax is recognised in other comprehensive income or directly in equity, respectively. Current tax is recognised on taxable profit for the current and past periods. Current tax is measured at the amounts of tax expected to pay or recover using the tax rates and laws that have been enacted or substantively enacted at the reporting date.

Deferred tax is recognised in respect of all timing differences at the reporting date. Unrelieved tax losses and other deferred tax assets are recognised to the extent that it is probable that they will be recovered against the reversal of deferred tax liabilities or other future taxable profits. Deferred tax is measured using the tax rates and laws that have been enacted or substantively enacted by the reporting date that are expected to apply to the reversal of the timing difference.

Trademarks

Trademarks are initially recorded at cost, and are subsequently stated at cost less any accumulated amortisation and impairment losses. Trademarks are amortised over their estimated useful life of fifteen years on a straight line basis.

Software

Computer software is stated at cost less accumulated amortisation and accumulated impairment losses. Software is amortised over its estimated useful life of seven years on a straight line basis.

Goodwill

Goodwill represents the excess of the fair value of the consideration given over the fair value of the identifiable net assets acquired. Amortisation is calculated so as to write off the cost of an asset, less its estimated residual value, over the useful economic life of that asset as follows: Goodwill - 10 to 15 years straight line

Tangible assets

Tangible fixed assets are stated at historic purchase cost less accumulated depreciation. Cost includes the original purchase price of the asset and the costs attributable to bringing the asset to its working condition for its intended use. Depreciation is calculated so as to write off the cost of an asset, less its estimated residual value, over the useful economic life of that asset as follows: Leasehold improvements 10 years straight line Fixtures & fittings - 3 to 10 years straight line Plant, machinery and equipment - 3 to 6 years straight line

Investments

Investments in subsidiaries are initially recorded at cost, and subsequently stated at cost less any accumulated impairment losses.

Cash and cash equivalents

Cash and cash equivalents includes cash in hand, deposits held at call with banks, other short-term highly liquid investments with original maturities of three months or less and bank overdrafts. Bank overdrafts, when applicable, are shown within borrowings in current liabilities.

Impairment of non-financial assets

At each balance sheet date non-financial assets not carried at fair value are assessed to determine whether there is an indication that the asset (or asset's cash generating unit) may be impaired. If there is such an indication the recoverable amount of the asset (or asset's cash generating unit) is compared to the carrying amount of the asset (or asset's cash generating unit). The recoverable amount of the asset (or asset's cash generating unit) is the higher of the fair value less costs to sell and value in use. Value in use is defined as the present value of the future cash flows before interest and tax obtainable as a result of the asset's (or asset's cash generating unit) continued use. These cash flows are discounted using a pre-tax discount rate that represents the current market risk-free rate and the risks inherent in the asset. If the recoverable amount of the asset (or asset's cash generating unit) is estimated to be lower than the carrying amount, the carrying amount is reduced to its recoverable amount. An impairment loss is recognised in the profit and loss account, unless the asset has been revalued when the amount is recognised in other comprehensive income to the extent of any previously recognised revaluation. Thereafter any excess is recognised in profit or loss.

Financial instruments

A financial asset or a financial liability is recognised only when the entity becomes a party to the contractual provisions of the instrument.

Basic financial instruments are initially recognised at the transaction price, unless the arrangement constitutes a financing transaction, where it is recognised at the present value of the future payments discounted at a market rate of interest for a similar debt instrument.

Debt instruments are subsequently measured at amortised cost. Where investments in non-convertible preference shares and non-puttable ordinary shares or preference shares are publicly traded or their fair value can otherwise be measured reliably, the investment is subsequently measured at fair value with changes in fair value recognised in profit or loss. All other such investments are subsequently measured at cost less impairment.

Other financial instruments, including derivatives, are initially recognised at fair value, unless payment for an asset is deferred beyond normal business terms or financed at a rate of interest that is not a market rate, in which case the asset is measured at the present value of the future payments discounted at a market rate of interest for a similar debt instrument.

Other financial instruments are subsequently measured at fair value, with any changes recognised in profit or loss, with the exception of hedging instruments in a designated hedging relationship (see hedge accounting policy).

Financial assets that are measured at cost or amortised cost are reviewed for objective evidence of impairment at the end of each reporting date. If there is objective evidence of impairment, an impairment loss is recognised in profit or loss immediately.

For all equity instruments regardless of significance, and other financial assets that are individually significant, these are assessed individually for impairment. Other financial assets are either assessed individually or grouped on the basis of similar credit risk characteristics.

Any reversals of impairment are recognised in profit or loss immediately, to the extent that the reversal does not result in a carrying amount of the financial asset that exceeds what the carrying amount would have been had the impairment not previously been recognised.

Defined benefit plans

The pension asset/(liability) recognised in the balance sheet is the value of the scheme's assets less the present value of the scheme's liabilities. The defined benefit scheme is closed to new entrants and at 30 September 2017 it closed to future accrual. The assets of the scheme are held separately from those of the company in an independently administered fund. The plan surplus has been recognised as an asset on the basis that the company has an unconditional right to receive the surplus on wind up of the plan or following the gradual settlement of liabilities. The unconditional right is provided under the trust deed and the rules of the plan. The pension cost for the scheme is analysed between past service cost and net return on pension scheme assets. Past service costs, relating to employee service in prior periods arising in the current period as a result of the introduction of, or improvement to, retirement benefits, are recognised in the profit and loss account on a straight-line basis over the period in which the increase in benefit vest. Net expected return on the pension scheme assets comprises the expected return on the pension scheme assets less interest on scheme liabilities. The actuarial gains and losses which arise from updating the latest actuarial valuation to reflect conditions at the balance sheet date are recognised in the other comprehensive income for the period.

Defined contribution plans

Contributions payable in the period in respect of services rendered are recognised as an expense. Differences between contributions payable in the period and contributions actually paid are shown as either accruals or prepayments in the balance sheet.

Share-based payments

The group issues equity-settled share-based payment awards to certain employees. Equity- settled share-based payments are measured at fair value (excluding the effect of non market-based vesting conditions) at the date of grant. The fair value determined at the grant date of the equity-settled share-based payments is expensed on a straight-line basis over the vesting period, based on the group's estimate of shares that will eventually vest and adjusted for the effect of non market-based vesting conditions, with a corresponding increase in the share option reserve. Fair value is measured using the Black-Scholes pricing model. The expected life used in the model has been adjusted, based on management's best estimate, for the effects of non-transferability, exercise restrictions and behavioural considerations. Employer's National Insurance is recognised at the current rates on the potential gain on these equity instruments, and on a straight line basis over the period of vesting of the options. The ultimate parent company recharges the costs related to shares granted to eligible employees of the company. The company does not settle the equity-settled share-based payment transaction in its own equity instrument. The transaction is accounted for as if it is a cash-settled share-based payment transaction. As the group recharges the costs on an accrual basis, there is no fair value share based payments liability at the balance sheet date.

Share capital

Equity instruments issued by the company are recorded at the proceeds received, net of direct issue costs.

Business combinations

Business combinations relating to acquiring control of trade and assets to form one or more businesses are accounted for using the purchase method. The cost of a business combination is measured as the aggregate of the fair values, at the acquisition date, of assets given, liabilities incurred or assumed, and equity instruments issued plus any costs directly attributable to the business combination. Where control is achieved in stages, the cost of the business combination is the aggregate of the fair values of the assets given, liabilities incurred or assumed, and equity instruments issued at the date of each transaction in the series. Where the business combination requires an adjustment to the cost contingent on future events, the estimated amount of that adjustment is included in the cost of the combination at the acquisition date providing it is probable and can be measured reliably. Where it is not recognised at the acquisition date but subsequently becomes probable and can be measured reliably, the additional consideration is treated as an adjustment to the cost of the combination. If such expected future events do not occur, or the estimate needs to be revised, the cost of the business combination is adjusted accordingly. The unwinding of any discounting is recognised as a finance cost in profit or loss in the period it arises.

Dividends

Equity dividends are recognised when they become legally payable. Interim equity dividends are recognised when paid. Final equity dividends are recognised when approved by the shareholders at an annual general meeting.

4. Judgements and key sources of estimation uncertainty

The company makes estimates and assumptions concerning the future. The resulting accounting estimates will, by definition, seldom equal the related actual results. The estimates and assumptions that have a significant risk of causing a material adjustment to the carrying amounts of assets and liabilities within the next financial year are addressed below.

Rebates

The company offers a variety of programs, primarily to retail customers, designed to promote sales of its products. Such programs require periodic payments and allowances based on estimated results of specific programs and are recorded as a reduction to net sales. The company accrues, at the time of sale, the estimated total payments and allowances associated with each transaction. At the balance sheet date, the company reviews the level of actual activity for each promotion and updates the accrual as required.

Defined benefit pension scheme

The company has an obligation to pay pension benefits to certain employees. The cost of these benefits and the present value of the obligation depend on a number of factors, including; life expectancy, salary increases, asset valuations and the discount rate on corporate bonds. Management estimates these factors in determining the net pension obligation in the balance sheet. The assumptions reflect historical experience and current trends. See note 22 for the disclosures relating to the defined benefit pension scheme.

Recoverable amount of investments

The company makes estimates of the recoverable amounts of its investments in subsidiary undertakings based on the net assets of the subsidiaries or the discounted net present value of their future operating cash flows. The latter involves significant estimates and assumptions related to revenue growth rates and discount rates.

Intangible assets

The company considers whether its intangible assets are impaired. Where an indication of impairment is identified the company estimates the recoverable value of the assets. This requires estimation of the future cash flows that will be generated by these assets and also selection of appropriate discount rates in order to calculate the net present value of those cash flows.

Useful economic lives of intangible assets

The annual depreciation charge for intangible assets is sensitive to changes in the estimated useful economic lives and residual values of the assets. The useful economic lives and residual values are re-assessed annually. They are amended when necessary to reflect current estimates, based on technological advancement, future investments, economic utilisation and the physical condition of the assets.

5. Turnover

Turnover arises from:

	2022	2021
	£000	£000
Sale of goods	61,111	58,164
	--------	--------

The whole of the turnover is attributable to the principal activity of the company wholly undertaken in the United Kingdom.

6. Other operating income

	2022	2021
	£000	£000
Third party royalty income	4	–
Management Service Fee from ETL	40,078	36,251
Other operating income	4,243	4,102
	--------	--------
	44,325	40,353
	--------	--------

Other operating income includes the income from recharges of regional head office activities to other group companies during the year and intercompany royalty income.

7. Operating profit

Operating profit or loss is stated after charging/crediting:

	2022	2021
	£000	£000
Amortisation of intangible assets	10,096	7,509
Depreciation of tangible assets	201	197

Impairment of intangible assets recognised in:

	Administrative expenses	3,000	–
Loss on disposal of tangible assets		33	–
Impairment of trade debtors		(3)	(39)
Equity-settled share-based payments expense		450	289
Operating lease rentals		472	502
Foreign exchange differences		( 772)	326
		--------	-------

8. Auditors' remuneration

	2022	2021
	£000	£000
Fees payable for the audit of the financial statements	124	162
	----	----

Fees payable to the company's auditors for:

Audit of the financial statements of fellow subsidiaries	270	371
	----	----

The company has paid audit fees for work undertaken in the UK on behalf the company's UK fellow subsidiaries Energizer UK Limited, Energizer Trading Limited and Berec Overseas Investments Limited as well as other European fellow subsidiaries. The company has borne these fees in its capacity as the European principal and has not recharged the fellow subsidiaries for these audit fees.

9. Staff costs

The monthly average number of persons employed by the company during the year, including the directors, amounted to:

	2022	2021
	No.	No.
Selling and administration	146	135
	----	----

The aggregate payroll costs incurred during the year, relating to the above, were:

	2022	2021
	£000	£000
Wages and salaries	11,350	10,464
Social security costs	1,391	1,307
Other pension costs	939	784
	--------	--------
	13,680	12,555
	--------	--------

Wages and salaries includes the cost of Equity-settled share-based payments £450,000 (2021: £289,000) (see note 23) Other pension costs are amounts charged to operating profit (see note 22). They do not include amounts credited to finance income or charged to finance costs (see notes 11 & 12), and amounts recognised in other comprehensive income.

10. Directors remuneration

The directors are all based in the US and are paid by the ultimate parent Energizer Holdings Inc.(EHI). EHI does not charge any UK entity for the services of these directors as they are paid predominantly for their services to EHI and not for their services as directors of the UK subsidiaries.

11. Interest receivable and similar income

	2022	2021
	£000	£000
Interest from group undertakings	421	336
Net finance income in respect of defined benefit pension plans	276	126
	----	----
	697	462
	----	----

12. Interest payable and similar expenses

	2022	2021
	£000	£000
Interest due to group undertakings	5,785	5,372
Other interest payable and similar charges	17	12
	-------	-------
	5,802	5,384
	-------	-------

13. Tax on (loss)/profit

Major components of tax expense

	2022	2021
	£000	£000

Current tax:

UK current tax expense	739	1,471
Adjustments in respect of prior periods	( 373)	63
	----	-------
Total UK current tax	366	1,534

Foreign current tax expense	8	–
	----	-------
Total current tax	374	1,534
	----	-------

Deferred tax:

Origination and reversal of timing differences	( 164)	371
	----	-------
Tax on (loss)/profit	210	1,905
	----	-------

Tax recognised as other comprehensive income or equity

The aggregate current and deferred tax relating to items recognised as other comprehensive income or equity for the year was £( 899,208 ) (2021: £ 1,544,658 ).

Reconciliation of tax expense

The tax assessed on the loss on ordinary activities for the year is higher than (2021: higher than) the standard rate of corporation tax in the UK of 19 % (2021: 19 %).

	2022	2021
	£000	£000
(Loss)/profit on ordinary activities before taxation	( 61,000)	4,439
	--------	-------
(Loss)/profit on ordinary activities by rate of tax	( 11,590)	843
Adjustment to tax charge in respect of prior periods	( 373)	63
Effect of expenses not deductible for tax purposes	11,579	1,209
Effect of capital allowances and depreciation	613	62
Schedule 23 relief	39	3
Group relief claimed not paid for	( 32)	( 674)
Other short term timing differences	( 34)	399
Foreign tax suffered	8	–
	--------	-------
Tax on (loss)/profit	210	1,905
	--------	-------

Factors that may affect future tax expense

The tax rate for the current year is the same as the prior year.

In the Spring Budget 2021, the UK Government announced that from 1 April 2023 the corporation tax rate would increase to 25% (rather than remaining at 19%, as previously enacted). This new law was substantively enacted on 24 May 2021. Deferred taxes at the balance sheet date have been measured using these enacted tax rates. In the Autumn Statement in November 2022, the government confirmed the increase in corporation tax rate to 25% from April 2023.

14. Intangible assets

	Goodwill	Trademarks	Software	Technology & Patents	Customer Lists	Total
	£000	£000	£000	£000	£000	£000
Cost
At 1 Oct 2021	96,824	10,798	7,878	910	4,268	120,678
Additions	–	–	213	–	–	213
Disposals	–	–	( 3)	–	–	( 3)
Acquisitions through business combinations (note 26)	12,344	–	–	–	–	12,344
	---------	--------	-------	----	-------	---------
At 30 Sep 2022	109,168	10,798	8,088	910	4,268	133,232
	---------	--------	-------	----	-------	---------
Amortisation
At 1 Oct 2021	13,608	7,000	3,996	–	–	24,604
Charge for the year	7,595	390	1,252	117	742	10,096
Impairment losses	53,312	1,323	–	308	1,369	56,312
	---------	--------	-------	----	-------	---------
At 30 Sep 2022	74,515	8,713	5,248	425	2,111	91,012
	---------	--------	-------	----	-------	---------
Carrying amount
At 30 Sep 2022	34,653	2,085	2,840	485	2,157	42,220
	---------	--------	-------	----	-------	---------
At 30 Sep 2021	83,216	3,798	3,882	910	4,268	96,074
	---------	--------	-------	----	-------	---------

Recent historical trends have shown an increasing shift in consumer demand towards hearing aid devices with built in rechargeable batteries compared to traditional devices with replaceable batteries. As a result of these trends management have performed a detailed impairment review of the carrying value of the goodwill related to the Micropower Hearing Aid Battery (HAB) business that the company acquired in November 2019. Management's projections for the next 5 years, based on this historical trend and external data sources, show a continued volume decline in the global micropower hearing aid battery category in the range of 4.5% to 6.5% a year for the next 5 years, stabilising in the sixth year. These projected category declines have been used to perform a net present value calculation of future cashflows that the company expects to achieve from the HAB business. In the NPV calculation the annual decline percentages have been increased by one percentage point a year to account for sensitivity in the forecasts and no growth or decline has been included in the terminal year. As a result of this impairment review £53.3m has been written off at the year end. Sensitivity analysis shows that a change in the WACC of +/-1% would have impacted the impairment loss by +/-£1m.

15. Tangible assets

	Land, buildings and leasehold improvements	Plant, machinery and equipment	Fixtures and fittings	Total
	£000	£000	£000	£000
Cost
At 1 October 2021	1,437	706	398	2,541
Additions	499	217	289	1,005
Disposals	( 614)	( 50)	( 398)	( 1,062)
	-------	----	----	-------
At 30 September 2022	1,322	873	289	2,484
	-------	----	----	-------
Depreciation
At 1 October 2021	1,025	662	392	2,079
Charge for the year	104	79	18	201
Disposals	( 586)	( 50)	( 393)	( 1,029)
	-------	----	----	-------
At 30 September 2022	543	691	17	1,251
	-------	----	----	-------
Carrying amount
At 30 September 2022	779	182	272	1,233
	-------	----	----	-------
At 30 September 2021	412	44	6	462
	-------	----	----	-------

16. Investments

	Shares in group undertakings
	£000
Cost
At 1 October 2021 and 30 September 2022	41,215
	--------
Impairment
At 1 October 2021 and 30 September 2022	–
	--------

Carrying amount
At 30 September 2022	41,215
	--------
At 30 September 2021	41,215
	--------

Subsidiaries, associates and other investments

	Registered office	Class of share	Percentage of shares held
Subsidiary undertakings
Energizer Brands UK Limited	Sword House	Ordinary	100
	Totteridge Road
	High Wycombe
	Bucks
	HP13 6DG
Energizer Brands II LLC		Ordinary	100

Energizer Brands II LLC is an overseas company incorporated in the United States with a UK establishment at Sword House, Totteridge Road, High Wycombe, HP13 6DG.

17. Debtors

	2022	2021
	£000	£000
Trade debtors	16,240	13,856
Amounts owed by group undertakings	36,022	44,558
Prepayments and accrued income	1,394	700
Corporation tax repayable	1,444	1,810
Other debtors	545	632
	--------	--------
	55,645	61,556
	--------	--------

Amounts owed by group undertakings are unsecured and are repayable on demand except for the fixed term loans disclosed below. Included within this amount are: £6,513,000 (2021: £13,955,000) owed by Energizer UK Limited. This loan matured in September 2023 and carried interest at 3.65% (2021: 2.63%) per annum. At the balance sheet date accrued interest of £Nil (2021: £Nil) was outstanding. The loan was renewed in September 2023. £2,000,000 (2021: £2,000,000) owed by Energizer Auto UK Limited. This loan matured in August 2023 and carried interest at 1.5% per annum. At the balance sheet date accrued interest of £3,000 (2021: £3,000) was outstanding. The loan was renewed in September 2023.

18. Creditors: amounts falling due within one year

	2022	2021
	£000	£000
Trade creditors	2,553	2,587
Amounts owed to group undertakings	126,864	118,294
Accruals and deferred income	6,432	6,646
Social security and other taxes	2,570	2,564
Accrued Rebates	15,934	17,036
	---------	---------
	154,353	147,127
	---------	---------

Amounts owed to group undertakings are unsecured and are repayable on demand except for the fixed term loan disclosed below. Included within this amount is: £106,400,000 (2021: £106,400,000) payable to Energizer Europe Limited. This loan matured in September 2023 and carried interest at 5.85% (2021:4.98%) per annum. At the balance sheet date accrued interest of £Nil (2021: £Nil) was outstanding. This loan was renewed after the year end and now matures in September 2024.

19. Creditors: amounts falling due after more than one year

	2022	2021
	£000	£000
Amounts owed to group undertakings	3,255	9,124
	-------	-------

Included within this amount are the following fixed term loans: £3,255,000 ($3,636,000) (2021: £2,695,000) payable to Energizer Brands II LLC. This loan matures in September 2026 and carries interest at 2.50% per annum. At the balance sheet date accrued interest of £82,000 (2021: £Nil) was outstanding and is included in creditors: amounts falling due within one year. £nil (2021: £6,429,000) payable to Energizer Brands UK Limited. This loan was fully repaid in March 2022.

20. Provisions for liabilities

	Deferred tax (note 21)
	£000
At 1 October 2021	3,648
Additions dealt with in profit or loss	( 164)
Additions dealt with in other comprehensive income	( 898)
	-------
At 30 September 2022	2,586
	-------

21. Deferred tax

The deferred tax included in the statement of financial position is as follows:

	2022	2021
	£000	£000
Included in provisions for liabilities (note 20)	2,586	3,648
	-------	-------

The deferred tax account consists of the tax effect of timing differences in respect of:

	2022	2021
	£000	£000
Accelerated capital allowances	152	257
Provisions for liabilities	( 26)	–
Pension plan obligations	2,565	3,495
Share-based payments	( 105)	( 104)
	-------	-------
	2,586	3,648
	-------	-------

22. Employee benefits

Defined contribution plans

The amount recognised in profit or loss as an expense in relation to defined contribution plans was £ 534,000 (2021: £ 510,000 ).

Defined benefit plans

The most recent comprehensive actuarial valuation was performed on 5 April 2021 and this has been rolled forward to 30 September 2022. In rolling forward the liabilities the following factors have been taken into consideration: - Changes in financial and demographic assumptions - Benefits paid from the Plan up to 30 September 2022 - Inflation experience on pension increases up to April 2023 and revaluations in September 2021 and September 2022

The statement of financial position net defined benefit asset is determined as follows:

	2022	2021
	£000	£000
Present value of defined benefit obligations	( 35,838)	( 53,605)
Fair value of plan assets	46,096	67,588
	--------	--------
	10,258	13,983
	--------	--------

Changes in the present value of the defined benefit obligations are as follows:

		2022
		£000
At 1 October 2021		53,605
Interest expense		1,051
Benefits paid		(2,079)
Remeasurements:
	Actuarial (gains) / losses	( 16,739)
		--------
At 30 September 2022		35,838
		--------

Changes in the fair value of plan assets are as follows:

		2022
		£000
At 1 October 2021		67,588
Interest income		1,327
Benefits paid		( 2,079)
Administration expenses		(405)
Remeasurements:
	Return on plan assets, excluding amount included in interest income	( 20,335)
		--------
At 30 September 2022		46,096
		--------

The total costs for the year in relation to defined benefit plans are as follows:

	2022	2021
	£000	£000

Recognised in profit or loss:

Net interest (income) / expense	( 276)	( 126)
Administration expenses	405	274
	----	----
	129	148
	----	----

Recognised in other comprehensive income:

Actuarial gains / (losses) arising from changes in assumptions	16,739	2,669
Return on plan assets, excluding amounts included in net interest	(20,335)	3,408
	--------	-------
	(3,596)	6,077
	--------	-------

The percentage that each major class constitutes of the fair value of the total plan assets at the reporting date are as follows:

	2022	2021
	%	%
Equity instruments	20.00	31.00
Debt instruments	73.00	68.00
Cash and cash equivalents	7.00	1.00

The plan surplus has been recognised as an asset on the basis that the company has an unconditional right to receive the surplus on wind up of the plan or following the gradual settlement of liabilities. The unconditional right is provided under the trust deed and the rules of the plan.

The principal actuarial assumptions as at the statement of financial position date were:

	2022	2021
	%	%
Discount rate	5.30	2.00
Expected rate of increase in pensions	3.40	3.15
Inflation assumption	3	3
Rate of revaluation in deferment	3.00	2.60
	-----	-----

23. Share-based payments

On January 27, 2020, the Company's shareholders approved the Energizer Holdings, Inc. Omnibus Incentive Plan (Omnibus Plan). The Omnibus Plan replaces and supersedes the 2015 Plan. No new awards will be issued under the 2015 Plan, though the terms of the 2015 Plan will continue to govern all awards granted under that plan. The Omnibus Plan authorises 6.5 million shares to be awarded, as well as the 0.3 million shares that were still available for grant under the 2015 Plan. Under the Omnibus Plan, stock options, stock appreciation rights, restricted stock and restricted stock units (time-based or performance-based), other stock awards and cash-based awards may be granted to directors, officers and employees of the Company. For purposes of determining the number of shares available for future issuance under the Omnibus Plan, awards other than stock options and stock appreciation rights, will reduce the shares available for future issuance by two for every one share awarded. Stock options and stock appreciation rights reduce the shares available for future issuance on a one-for-one basis. At September 30, 2022, there were 4.3 million shares available for future awards under the Plan.

The total expense recognised in profit or loss for the year is as follows:

	2022	2021
	£000	£000
Equity-settled share-based payments	450	289
	----	----

Restricted Stock Equivalents (RSE) EHI granted RSE awards each November since 2015 to groups of key employees and executives that vest rateably over four years and performance shares that will vest subject to meeting target amounts for both cumulative adjusted earnings per share and cumulative free cash flow as a percentage of sales over the three year performance period. These performance measures are equally weighted in determining the final share award.

24. Called up share capital

Issued, called up and fully paid

	2022		2021
	No.	£	No.	£
Ordinary shares of £– each	618,640,000	–	618,640,000	–
	--------------	----	--------------	----

25. Reserves

The Share Premium account represents the premium received in excess of the nominal value of the following issued shares:

	2022	2021
	£000	£000
At 1 October	41,215	–
602,360,000 ordinary £0.00000006 shares issued to Energizer Trading Limited	–	41,215
	--------	--------
At 30 September	41,215	41,215
	--------	--------

26. Business combinations

Acquisition of non distribution trade and assets from Custom Accessories Europe Limited

The fair value of consideration paid in relation to the acquisition of non distribution trade and assets from Custom Accessories Europe Limited is as follows:

	£000
Intercompany loan notes	12,215
	--------

The fair value of amounts recognised at the acquisition date in relation to non distribution trade and assets from Custom Accessories Europe Limited are as follows:

	Fair value
	£000
Tangible assets acquired	352
Trade debtors acquired	16
Other debtors acquired	67
Cash and cash equivalents acquired	412
Trade creditors assumed	( 25)
Other creditors assumed	( 951)
	----
	( 129)

Goodwill on acquisition	12,344
	--------
	12,215
	--------

27. Operating leases

The total future minimum lease payments under non-cancellable operating leases are as follows:

	2022	2021
	£000	£000
Not later than 1 year	458	445
Later than 1 year and not later than 5 years	1,758	1,737
Later than 5 years	30,954	31,379
	--------	--------
	33,170	33,561
	--------	--------

28. Controlling party

The company's immediate parent is Energizer Trading Limited , a company registered in England and Wales. The company's ultimate parent company and controlling party is Energizer Holdings Inc ., a US company incorporated in the state of Missouri. The parent undertaking of the smallest and largest group for which financial statements are drawn up and of which the company is a member is Energizer Holdings Inc ., incorporated in the USA. Copies of Energizer Holdings Inc.'s annual report can be obtained from Investor Relations, Energizer Holdings Inc., 533 Maryville University Drive, St Louis, MO 63141, USA.