Procter & Gamble (P&G) today (January 27th) posted a 31 per cent drop in quarterly net income, arguing its sales were hurt by weakening foreign currencies against the dollar.
The world’s largest consumer-products maker said net income dropped to $2.4 billion (£1.58 billion) from $3.4 billion a year ago for the period ending December 31st.
It added that results were also hit by a $740 million charge related to the sale of its Duracell battery business to Berkshire Hathaway, as those results were presented as discontinued operations.
Net income dropped to $2.37 billion, from $3.43 billion a year earlier, P&G said in a statement. Core earnings, excluding discontinued operations and foreign exchange, were down eight per cent to $1.06 per share. Meanwhile, net sales dropped four per cent to $20.2 billion.
"Virtually every currency in the world devalued versus the US dollar, with the Russian rouble leading the way," said chief executive officer A.G. Lafley. "The considerable business portfolio, product innovation and productivity progress was not enough to overcome foreign exchange," he added.
The company's baby, feminine and family care segment saw its organic sales grow four per cent, while fabric and home care organic sales increased three per cent.
The beauty, hair and personal product segment saw its organic sales fall two per cent during the quarter.
"The outlook for the year will remain challenging. Foreign exchange will reduce fiscal 2015 sales by five per cent and net earnings by twelve per cent, or at least $1.4 billion after tax," A.G Lafley said.
"Trying to provide some measure of optimism, he added, “We have and will continue to offset as much of this currency impact as we can through productivity driven cost savings. We are working to deliver core earnings per share as close as possible to those of last fiscal year."
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