Monday, October 14, 2024

P and G reports a $2.8 billion profit

635972269410601704-P-G-towers-long-shot.jpg

Procter & Gamble on Tuesday reported a $2.8 billion profit for its third quarter ended March 31 – a 28 percent increase from a year ago.

Total sales at the Cincinnati-based consumer products giant dropped 12.7 percent to $15.8 billion, from the same period in 2015. Adjusted for the company's ongoing divestiture of nearly 100 noncore brands, sales declined 7 percent from last year. The company said closely-watched organic sales (a metric that excludes the impacts of mergers, acquisitions and foreign exchange) rose 1 percent.

Wall Street analysts had forecast for P&G to post a $2.2 billion profit for the quarter, excluding one-time items, according to Bloomberg. They also expected sales to be $15.8 billion. Last year, P&G reported a $2.2 billion profit on sales of $18.1 billion in sales.

“We continue to make progress on the transformations we are undertaking to return P&G to balanced

top- and bottom-line growth and maintain strong cash generation,” CEO David Taylor said.

P&G has reclassified more than 40 beauty brands it plans to sell later this year as "discontinued operations" and amended their financial statements to reflect those changes. Had P&G already exited those and other brands already sold off, the company said total sales for the quarter a year ago would have been $16.9 billion.

The brand sale is part of a broader restructuring that has already jettisoned the Duracell batteries brand and Iams pet food and others. Since 2014, P&G has embarked on selling off brands commanding $10 billion in sales to slim down to a $70 billion company doing business under 65 core labels.

The Duracell brand sale to Warren Buffett's Berkshire Hathaway closed in the third quarter. The conglomerate tendered 52 million shares of P&G stock back to the Cincinnati company in exchange for the battery brand.

Based on the stock price at closing and netting out the $1.8 billion P&G was required to reinvest in Duracell before handing it off, the consumer products company got $2.4 billion for the battery brand. But instead of getting a cash infusion, the transaction retired 2 percent of P&G's entire outstanding stock.

Later this year, P&G will close on its divestiture of the beauty brands it has decided to exit, including CoverGirl makeup, Wella and Clairol hair coloring. Those brands doing $6 billion in annual sales will become a separate company that will merge with New York's Coty Inc., which makes Rimmel makeup and is the licensed manufacturer of Calvin Klein and dozens of other fragrances.

Source link

Red
Author: Red

Related Articles

spot_img

Latest Articles

s2Member®