The Procter & Gamble Company announced that the sale of its snacks division helped its income rise 45% in its fourth fiscal quarter. Procter’s net income rose to $3.63 billion, or $1.24 a share, from $2.51 billion, or $0.84 a share, in the same quarter a year earlier. The sale of its snacks business increased income by $0.48 a share.
Excluding the benefits of selling its snack division and restructuring costs, the company earned $0.82 a share, higher than analysts’ expectations of $0.77 a share. Revenue for the period ending June 30 decreased by 1%, to $20.21 billion, from $20.45 billion. This was slightly lower than analysts’ expectations of $20.26 billion. Revenue excluding acquisitions, selling businesses, and some instances of foreign exchange rose 3%.
The stronger dollar hurt revenue by 4 percentage points. Higher prices helped revenue by 4 percentage points, offsetting the currency shift. The results topped the forecasts of Wall Street analysts. The company also announced plans to buy back $4 billion in shares this fiscal year
The company’s $10 billion cost-cutting plan is making progress and its efforts to improve results by focusing on its most profitable categories have seen success. Chief financial officer Jon R. Moeller said the company cut 2,000 non-manufacturing jobs when the target was 1,600 jobs by June 30 and was ahead on its job-cutting plans. The company said it should reach its target of cutting 10% of jobs by the end of the calendar year.
Procter executives remarked that its strategy to prioritize bringing new products to market was on track, as was its plan to expand in the biggest emerging countries and its biggest, most profitable markets. Procter has admitted making some mistakes in pricing and balancing growth in emerging markets in an uncertain global economy with tepid market share growth. Emerging markets make up about 30% of its sales. The company makes Crest toothpaste, Tide detergent, and other consumer goods.
