Q2 Earnings to ‘Exceed Estimates’, Says P&G

12 December 2001

Household and food products colossus Procter & Gamble announced Tuesday it would better analysts’ estimates in its second fiscal quarter, thanks mainly to increases both in volume and sales among its health and beauty care ranges.

P&G also expects to see overall sales rise for the first time in four quarters, while earnings will be enhanced by the sale of its stake in drug developer Regeneron Pharmaceuticals.

Core earnings, predicts P&G, will be between two to three cents a share higher than the entrail-rakers’ current consensus estimates, prompting one such seer, Jim Gingrich, consumer products analyst at Sanford Bernstein, to display his penetrating insight into the world of commerce: “What it indicates,” he opined, “is that they are certainly beginning to execute better than in the past.”

P&G also forecast that sales growth will accelerate in the second half of the fiscal year ending June. It will be driven by new products such as Pampers Baby Stages of Development diapers and a Crest Spinbrush with replaceable heads.

“Despite significant economic uncertainties that continue to exist in the global marketplace,” said chief executive A G Lafley, “we are seeing satisfactory volume progress in all regions, with health care and beauty care delivering particularly strong growth. P&G's improving cash flow and cost structure means that we have the financial flexibility to invest behind promising innovations on established and new brands.”

News source: New York Times