Procter & Gamble Lowers Guidance, Keeps Savings Targets

Date : 06/20/2012 @ 5:12AM
Source : Dow Jones News
Stock : Procter & Gamble Company (The) (PG)
Quote : 89.55  0.93 (1.05%) @ 5:00PM

Procter & Gamble Lowers Guidance, Keeps Savings Targets

Procter Gamble (NYSE:PG)
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   By Geraldine Amiel 
 

PARIS--Procter & Gamble Co (PG) Wednesday lowered its earnings guidance for the current quarter as well as for fiscal year 2013, citing market share softness in developed markets and a negative impact from foreign exchange rates.

Chairman and Chief Executive Bob McDonald also gave details on his program to refocus the group on more profitable businesses, reiterating the substantial cost-saving program.

P&G expects its core earnings per share for the April-to-June quarter to be in the range of $0.75 to $0.79 from a previously expected range of $0.79 to $0.85 while organic sales growth is now expected to be 2% to 3%, compared with a previous expectation of a growth of 4% to 5%. Net sales for the quarter are expected to be down 1% to 2% as foreign exchange is expected to reduce them by 4%, Mr. McDonald said.

The lowered guidance comes as the world's largest consumer products company reported in April a string of weak results, fueling investors' worries as well as expectations of a substantial overhauling of the group's operations and practices to recoup the ground lost to competitors such as Unilever PLC (UL) and Colgate-Palmolive Co. (CL)

"We must and we will improve," Mr. McDonald said during a consumer conference in Paris. "We need to be more efficient and more productive," he added, while reiterating the group's cost-saving plan, noting it had made "good progress."

P&G targets cost savings of $10 billion by 2016, with around 5,700 non-manufacturing job cuts by the end of the 2013 fiscal year.

-Emily Glazer contributed to this story.

Write to Geraldine Amiel at geraldine.amiel@dowjones.com




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