Amarantos blog

P&G reports fall in 2Q net; sales picking up

CINCINNATI – Procter & Gamble Co., the world's largest consumer products maker, says sales are picking up as households in the U.S. and other developed countries loosen up their spending.

The Cincinnati-based maker of Tide detergent and Gillette shavers had net income of $3.33 billion, or $1.11 per share, compared with $4.66 billion, or $1.49 per share last year, when earnings got a boost from sale of the company's prescription drug business.

P&G says net income from continuing operations was up about 10 percent — from $1.01 per share and $3.15 billion.

Revenue rose 2 percent to $21.3 billion as the company sold more products in most of its markets. Analysts expected $1.10 per share on $21.51 billion. The company said it gained market share aross its geographic markets.

P&G forecast revenue to rise 5 to 7 percent in the current quarter, with earnings in a range of 95 cents to $1. Analysts expect 99 cents on $20.1 billion, which would be about a 5 percent sales increase.

Bob McDonald, CEO and chairman, told reporters on a conference call Thursday that P&G has seen sales picking up in the United States, Japan and western Europe, developed countries which had flattened during the recession.

"We believe we're in the midst of a recovery," McDonald said. "We're seeing a good pace ... in January."

For the full year, P&G stuck with its earlier guidance of $3.91 to $4.01; analysts expect $3.98 per share on revenue of $81.9 billion.

P&G reported success in its efforts to catch consumers' eyes with premium upgrades such as the Gillette Fusion ProGlide launched last year, or appeal to tightened budgets with lower-priced versions of products, coupons and other discounts to keep shoppers from trading down to cheaper competitors.

Shares fell $1.76, or 2.7 percent, to $64.35 in premarket trading.