UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer”,filer,” “accelerated filer”,filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.

The above financial statements should be read in conjunction with the Notes To Consolidated (Condensed) Financial Statements (Unaudited).

The above financial statements should be read in conjunction with the Notes To Consolidated (Condensed) Financial Statements (Unaudited).

ENERGIZER HOLDINGS, INC.

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Condensed)

(In millions - Unaudited)

On July 1, 2015,December 11, 2018, the European Commission approved the acquisition of the Acquired Battery Business conditioned on the divestiture of the Varta consumer battery, chargers, portable power and portable lighting business in the Europe, Middle East and Africa region (EMEA), including manufacturing and distribution facilities in Germany. Energizer completed its legal separationwill retain the rights to the Varta brand in Latin America and Asia Pacific, as well as Spectrum’s global Rayovac branded consumer and hearing aid batteries business. Energizer began the formal divestiture process immediately after close and expects to complete the divestiture in the beginning of the fourth quarter of fiscal 2019. The assets and liabilities associated with this business have been reported as held or sale both on the preliminary purchase price allocation and the Consolidated (Condensed) Balance Sheets as of March 31, 2019.

For purposes of the allocation, the Company determined a preliminary fair value adjustment for inventory based on the estimated selling price of finished goods on hand at the closing date less the sum of (a) costs of disposal and (b) a reasonable profit allowance for the selling effort of the acquiring entity. The preliminary fair value adjustment for the inventory of $14.2 was recorded as expense to Cost of products sold in the second quarter 2019 as that inventory was sold. The fair values of the Battery Acquisition's Property, plant and equipment were estimated using the market approach for land and variations of the cost approach for the buildings and equipment. The fair values of the Battery Acquisition's identifiable intangible assets were estimated using variations of the income approach such as the relief from Edgewell Personal Care Company (Edgewell) via a tax free spin-off (the spin-off or spin). royalty method and the multi-period excess earnings method.

The Company incurred costs associatedis still evaluating the current and deferred tax implications and the accounting implications of the asset versus stock deal by legal jurisdiction, as well as the varying statutory tax rates across the global business. The Company maintained the deferred balances from the carrying amount of the Acquired Battery Business as of January 2, 2019 until that evaluation is completed. Preliminary step ups on the deferred tax liabilities have been recorded based on the valuation of the Property, plant and equipment and Intangible assets.

Assets held for sale include the valuation of Inventory, Property, plant and equipment and Intangible assets consistent with the evaluation, planning and executionvaluation methods discussed above. The preliminary fair value adjustment for the inventory of

$11.2 was recorded as expense in the spin transaction. Forresults from discontinued operations in the three months ended December 31, 2017, the Company recorded no activity related to spin. During thesecond quarter ended December 31, 2016, the Company sold a facility in North America2019 as that inventory was previously closed as partsold. A preliminary estimate of the spin and recorded a gain of $1.3 in spin restructuring. On a project to date basis, the total costs incurred orgoodwill has also been allocated to Energizerthe Assets held for the spin were $197.6, inclusive of the costs of early debt retirement recorded in fiscal 2015. We do not expect any additional costs related to spin.

The following table representsoutlines the spin restructuring accrual activity and ending accrual balancepreliminary purchase price allocation as of Decemberthe date of acquisition:

The following table summarizes the components of Loss from discontinued operations in the accompanying Consolidated (Condensed) Statement of Earnings and Comprehensive Income for the quarter and six months ended March 31, 2019. As the Company acquired the business on January 2, 2019, there is no activity on the Consolidated Condensed Balance Sheet. At December(Condensed) Statement of Earnings and Comprehensive Income for the three and six months ended March 31, 2016, $2.22018:

Included in the loss from discontinued operations are the inventory fair value pre-tax adjustment of the liability was recorded in Other current liabilities$11.2, divestment related pre-tax costs of $5.7 and the remaining $2.1 was recorded in Other liabilities. There were no liabilities outstanding at September 30, 2017 or December 31, 2017.allocated pre-tax interest expense of $6.2.

The threesix month effective tax rate was 49.2%46.9% as compared to 28.7%50.1% for the prior year comparative period. The current year provision included the estimated impact of disallowed transaction costs related to the Battery Acquisition and the Auto Care Acquisition for which the Company does not believe that there will be an income tax benefit. Both years' provision included the impact of the U.S. tax legislation discussed below.

On December 22, 2017, H.R. 1, formally known as the Tax Cuts and Jobs Act (the Tax Act) was enacted into law. The Tax Act providesprovided for numerous significant tax law changes and modifications with varying effective dates, which includeincluded reducing the corporate income tax rate from 35% to 21%, creating a territorial tax system (with a mandatory transition tax on previously deferred foreign earnings) and allowing for immediate capital expensing of certain qualified property. As a fiscal year end taxpayer, certain provisions of the Tax Act will beginbegan to impact us in ourthe fiscal first quarter ended December 31, 2017, while other provisions willdid not impact us beginning inuntil fiscal year 2019. The corporate tax rate reduction iswas effective for Energizer as of January 1, 2018 and accordingly, will reduce our currentresulted in a fiscal year federal statutory rate to a blended rate of approximately 24.5% for fiscal year 2018.

As a result of the reduction of the Federal corporate income tax rate, we havethe Company remeasured certain deferred tax assets and liabilities at the rate which they are expected to reverse in the future. We are still analyzing certain aspects of the Act, including the future impacts of the Global Intangible Low-Taxed Income provision, and refining our calculations, which could potentially affectThe Company has finalized the remeasurement of these balances or potentially give rise to new deferred tax amounts. The provisional amount recorded relatedand did not have any adjustments to the remeasurement of our deferred tax balance was tax expense of$3.0 recorded in fiscal year 2018. The provision for the six months ended March 31, 2018, included approximately $1.

The mandatory transition tax is based on our total post-1986 earnings and profits (E&P) that we previously deferred from U.S. income taxes. We recorded a provisionaltaxes as well as the amount for our mandatory transition tax liability, resulting in an increase inof non-U.S. income tax expense of approximately $30.paid on such earnings. We have not yet completed our calculationaccounting for the income tax effect of the total

(6) Share-Based Payments

Total compensation cost charged against income for Energizer’s share-based compensation arrangements was $6.7$7.6 and $14.1 for the quarter and six months ended DecemberMarch 31, 20172019, respectively, and $5.2$7.3 and $14.0 for the quarter and six months ended DecemberMarch 31, 20162018, respectively, and was recorded in SG&A expense.

Restricted Stock Equivalents (RSE)—(in whole dollars and total shares)

In November 2017, the Company granted RSE awards to a group of key employees of approximately 100,000 shares that vest ratably over four years and granted RSE awards to a group of key executives of approximately 68,000 shares that vest on the third anniversary of the date of grant. In addition, the Company granted approximately 238,000 performance shares to a group of key employees and key executives 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 with the maximum award payout of approximately 476,000 shares. The closing stock price on the date of the grant used to determine the award fair value was $44.20.

In November 2016, the Company granted RSE awards to a group of key employees of approximately 92,000 shares that vest ratably over four years and granted RSE awards to a group of key executives of approximately 73,000 shares that vest on the third anniversary of the date of the grant. In addition, the Company granted approximately 249,000 performance shares to a group of key employees and key executives that will vest subject to meeting targeted 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. These performance measures are equally weighted in determining the final share award with the maximum award payout of approximately 498,000 shares. The closing stock price on the date of the grant used to determine the award fair value was $43.84.

In November 2015, the Company granted RSE awards to a group of key employees of approximately 106,000 shares that vest ratably over four years and granted RSE awards to a group of key executives of approximately 87,000 shares that vest on the third anniversary of the date of the grant. In addition, the Company granted approximately 290,000 performance shares to a group of key employees and key executives that will vest subject to meeting targeted 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. These performance measures are equally weighted in determining the final share award with the maximum award payout of approximately 580,000 shares.years. The closing stock price on the date of the grant used to determine the award fair value was $37.34.