P&G Beats on Profit; Forecast Disappoints Street Estimates
Procter & Gamble reported quarterly earnings that beat analysts' expectations on Wednesday, but its profit outlook for the current quarter fell short of Wall Street's expectations.
On a net basis, the company earned $2.57 billion, or 88 cents per share, in the fiscal third quarter ended in March, up from $2.41 billion, or 82 cents per share, a year earlier.
Following the earnings report, the company's stock fell in trade on Wednesday. (Click here to track the company's shares following the report.)
Excluding one-time items such as restructuring charges, the company posted fiscal third-quarter earnings of 99 cents per share, up from 94 cents a share in the year-earlier period.
Revenue rose to $20.6 billion from $20.19 billion a year ago, but fell short of what Wall Street was expecting. The company cited "heavy" competition taking a toll on net sales of hair care and skin products. Meanwhile, household goods and appliance net sales also dipped due to various factors, including competition and foreign currency translation.
Analysts had expected the company to report earnings excluding items of 96 cents a share on $20.73 billion in revenue, according to a consensus estimate from Thomson Reuters.
P&G has been trying to reinvigorate itself under Chief Executive Bob McDonald. While products such as Tide Pods have boosted U.S. sales, P&G still needs to figure out the formula for getting products such as Pantene shampoo to stand out among a host of similar competitors, it said. Net sales decreased in the hair care and skin care business in the latest quarter.
For the current quarter, the world's largest household products maker forecast core earnings of 69 cents to 77 cents per share, while analysts were looking for a profit of 81 cents.
In an interview with CNBC, P&G's CFO Jon Moeller lauded "broad strength across the U.S." and in key product lines such as laundry, oral care and shaving products. However, he acknowledged that the company had "been struggling a bit in hair care."