Procter & Gamble Co., the world’s largest consumer-products company, posted first-quarter profits that topped analysts’ estimates, helped by lower costs and a slimmer stable of brands.
Profit was $1.03 a share, excluding some items, Cincinnati-based P&G said in a recent statement. Analysts had estimated 98 cents, on average. Revenue was little changed, at $16.5 billion, roughly matching analysts’ projections.
The results show that chief executive officer David Taylor is making progress on the $10 billion cost-cutting programme on which he embarked after taking the helm last year. P&G also completed the divestiture of more than 40 beauty brands to Coty, Inc. this month – a sale orchestrated by Taylor’s predecessor – allowing P&G to focus on reinvigorating its main household and personal-care businesses.
The shares rose 2.3% to $86 at 7.34 a.m. in early trading in New York. The stock gained 5.9% this year through Monday.
P&G also showed some signs of improvement on the demand side, with organic sales – a measure that excludes the effects of currency exchange-rate fluctuations, as well as acquisitions and divestitures – rising in all of the company’s units.
Sales by that measure advanced 3% in the grooming business, which includes Gillette shaving products. Organic sales climbed 3% in the beauty unit, which sells Pantene shampoo and Olay skincare products. The health-care division, the maker of Crest toothpaste and Prilosec heartburn medicine, had the biggest organic sales increase, at 7%.
P&G maintained its forecasts that organic sales would grow about 2% and adjusted earnings would increase at a mid-single-digit percentage rate in its current fiscal year.
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