UPDATE 3-Procter & Gamble soars past profit expectations
* P&G profit of $1.06/share tops expectations of 96 cents
* P&G keep forecast for fiscal 2013 core earnings per share
* Colgate matches expectations, plans job cuts
* P&G shares up 4 percent, Colgate down 2.9 percent
Oct 25 (Reuters) - Procter & Gamble Co's profit rose more than expected, indicating that the world's largest household products maker is making progress after coming under pressure from activist investor William Ackman, and its shares soared to the highest level in four years.
Rival Colgate-Palmolive Co, meanwhile, said it plans to cut about 6 percent of its workforce over the next four years as it strives to operate more nimbly as economies slow in many countries. Its quarterly profit matched expectations.
Several consumer goods makers are trimming jobs, including P&G, as concerned consumers hold off on some purchases and growth slows in major markets such as China.
P&G is on track to cut 4,200 jobs by the end of October on its way to eliminating 5,700 jobs by the end of its fiscal year. On Wednesday, Kimberly-Clark Corp said it would eliminate 1,300 to 1,500 jobs as it leaves some low-margin businesses in Europe. Colgate's plans, including moving away from single-country units toward regional hubs, should lead the toothpaste maker to trim about 2,300 jobs by the end of 2016.
Shares of P&G rose 4 percent to $70.83 on Thursday, their highest level since October 2008. Colgate's shares fell 2.9 percent to $103.44.
``It wouldn't surprise me if we're seeing some people saying it is time to sell some Colgate, buy some Procter, given Colgate's outperformance year to date,'' said JP Morgan analyst John Faucher, who has a ``neutral'' rating on Colgate and an ``overweight'' rating on P&G.
Colgate's shares had risen 15 percent this year through Wednesday, while P&G shares were up less than 1 percent.
P&G is cutting costs and narrowing its focus on key markets, products and countries. The company's goals as well as Chairman and Chief Executive Bob McDonald have been under intense scrutiny after Ackman bought shares this summer.
P&G did not raise its key profit forecast for the fiscal year that began in September, in part because it plans to ramp up marketing support behind new products being introduced later in the year, and because it has to spend more to get an absorbent material for Pampers diapers, its largest brand, following a plant explosion in Japan.
P&G earned $1.06 per share in the fiscal first quarter on a ``core'' basis, which excludes charges, up from $1.01 per share a year earlier. Analysts, on average, expected it to earn 96 cents per share, according to Thomson Reuters I/B/E/S.
Earnings from continuing operations fell to $2.85 billion, or 96 cents per share, from nearly $3.0 billion, or $1.01 per share, a year earlier.
Ackman, whose Pershing Square Capital Management is P&G's 10th-largest shareholder, has publicly blamed P&G's top brass for high costs and declining revenue while saying that he understands the board wants to give McDonald time to repair years of damage.
P&G is putting a fresh focus on productivity, including adding a new global officer of productivity and organization transformation who will report to McDonald, as well as creating a productivity council of senior managers.
P&G's net sales in the quarter fell 4 percent to $20.74 billion, below analysts' target of $20.78 billion. Organic sales, which strip out the impact of acquisitions, divestitures and foreign exchange, rose 2 percent, at the high end of the company's forecast.
P&G still expects to post core earnings per share of $3.80 to $4 this fiscal year. Analysts' average forecast for the year is $3.91 per share.
For the current second quarter, P&G forecast core earnings of $1.07 to $1.13 per share, with organic sales up 1 percent to 3 percent.
P&G is dealing with the impact of a plant explosion in Japan that supplies a key material for Pampers diapers. Pampers is the company's largest single brand, accounting for more than $10 billion in annual sales.
There was an explosion at a Nippon Shokubai Co factory in September that produces a key material for P&G's Pampers diapers. Nippon Shokubai is one of the world's biggest makers of acrylic acid, the main ingredient of a resin called SAP, which is used in diapers.
P&G has found other sources of the material and while any impact to consumers should be ``minor,'' it has to spend more get the supplies it needs, said Chief Financial Officer Jon Moeller.
Kimberly-Clark, which makes Huggies diapers, said on Wednesday that it was not affected by the explosion since Nippon Shokubai was not its supplier.
Colgate earned $1.38 per share, matching analysts' forecasts, while sales fell 1 percent to $4.33 billion.