Procter & Gamble Co. gave muted guidance for its new fiscal
year on Thursday, as sales fell 9.2% in the June quarter on volume
decreases and the company booked a big charge related to an
accounting change for its Venezuela operations.
Shares fell 1.4% in premarket trading.
For the year ending in 2016, the company expects earnings to be
in a range of "slightly below" last year's $3.77 a share "to up
mid-single digits." It forecast organic sales that are in-line to
up low-single digits. Analysts had called for earnings of $4.18 a
share.
P&G also said it sees foreign exchange cutting into overall
sales by 4 to 5 percentage points.
The consumer products giant is in the middle of a transition. At
the beginning of the month, it said it would carve off brands
including Wella shampoos, Clairol hair dye and CoverGirl makeup and
merge them with Coty Inc. in a complicated $13 billion deal.
Then, it reported that Chief Executive A.G. Lafley will be
stepping down. He will be succeeded by 35-year company veteran
David Taylor, who will take over as CEO on Nov. 1, with Mr. Lafley
shifting to the role of executive chairman.
In the latest quarter, total unit volume was down 1%, with
volume down 4% in its beauty and personal care segment, down 3% in
grooming, and up 1% in the fabric segment.
Organic sales were flat, as a three percentage point benefit
from pricing and mix was offset by lower shipment volume.
Overall, the company reported earnings of $521 million, or 18
cents a share, down from $2.58 billion, or 89 cents a share, a year
earlier.
Excluding certain items, earnings were $1 a share. The company
took a more than $2 billion write-down on its Venezuelan
operations, and foreign exchange shaved off nine percentage
points.
Revenue fell to $17.79 billion from $19.6 billion.
Analysts had expected per-share earnings of 95 cents and revenue
of $17.98 billion, according to Thomson Reuters.
Write to Angela Chen at angela.chen@wsj.com
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