P&G profit ahead of expectationsThursday 24 April 2014 12.35
Procter & Gamble reported a higher than expected quarterly profit, helped by an increase in home care products sales and better cost control.
But net sales were unchanged at $20.6 billion, disappointing investors looking for stronger growth. Organic sales, which exclude the impact of divestitures and acquisitions, rose 3%.
Organic sales at P&G's fabric care and home care division, which generates almost one third of sales, rose 6%. Brands in that category include Tide, Febreze air freshener and Duracell batteries.
Grooming, its most profitable business, saw sales rise 1%. P&G's struggling beauty division, which includes Head & Shoulders and Olay, improved, with sales up 2%.
P&G has been under pressure to launch innovative products and streamline its businesses to focus on its core products. Two weeks ago, P&G said it was is selling the bulk of its pet food business to Mars for $2.9 billion.
"We're operating in a slow-growth, highly competitive environment," chief executive AG Lafley said in a statement.
Under a five-year, $10 billion restructuring plan announced in February 2012, P&G has sought to cut expenses by streamlining management, lower overhead costs and lower marketing costs. Chief Financial Officer Jon Moeller told reporters on a call that restructuring was running ahead of schedule.
The maker of Pampers nappies and Tide detergent earned $2.61 billion in the fiscal third quarter ended March 31, up slightly from $2.57 billion a year earlier.
P&G left its 2014 forecasts unchanged. It still expects organic sales to rise 3% to 4%, and core earnings to rise 5% to 7%.