P&G raises fiscal year outlook
CINCINNATI — Procter & Gamble posted a boost in sales and earnings for the second quarter and raised its outlook for the fiscal year, the company announced on Friday.
“Our second-quarter results were at the high end of our expectations on the top line and well ahead of forecast on operating profit, earnings per share and cash flow,” stated Bob McDonald, chairman, president and CEO. “Global market share trends improved as we continued to implement our growth strategy and made very good progress against our productivity and cost-savings goals. Our strong first-half results have enabled us to raise our sales, earnings and share repurchase outlook for the fiscal year, while we strengthen investments in our innovation and marketing programs.”
Diluted earnings per share were $1.39, an increase of 144% as core earnings rose 12% to $1.22. Noncore items include restructuring charges of 5 cents per share a 21 cent per share holding gain resulting from P&G’s purchase of the balance of the P&G’s baby care and feminine care joint venture in Iberia, which was completed in October.
Net sales totaled $22.2 billion, an increase of 2% compared with the year-ago period, including a negative 1% impact from foreign exchange. Organic sales grew 3%.
P&G increased its core earnings per share guidance for the year to $3.97 to $4.07, up 3% to up 6% versus prior year core EPS of $3.85, behind strong productivity improvement and resulting cost savings. P&G also raised its all-in GAAP earnings per share guidance to a range of $4.04 to $4.14, equating to growth of 10% to 13% versus prior year GAAP EPS of $3.66. The increase reflects higher core earnings and an increase in the noncore holding gain resulting from P&G’s purchase of the balance of our Baby Care and Feminine Care joint venture in Iberia. The all-in EPS range also includes noncore restructuring charges of $0.15.
P&G increased its organic sales growth guidance to a range of 3% to 4% for the fiscal year from a previous range of 2% to 4%. Foreign exchange is expected to reduce sales growth by 2%, resulting in guidance for all-in net sales growth of up 1% to 2% versus the prior year.
The company also increased its outlook for share repurchase to $5 billion to $6 billion, up from a prior range of $4 billion to $6 billion.