NEW YORK: Procter & Gamble reported higher profits Friday, but lowered its 2016 sales forecast due to the strong dollar and the impact of asset sales.
The maker of such household items as Crest toothpaste and Tide detergent said earnings for the quarter ending September 30 were $2.6 billion, up 30.7 percent from the year-ago period.
Revenues fell 12.0 percent to $16.53 billion.
Sales declined in all five of P&G’s businesses, with grooming suffering the biggest drop at 14 percent.
However, excluding currency effects, two of the businesses notched flat sales and the other three saw much smaller drops in revenues.
“We delivered strong first quarter operating profit margin and free cash flow results,” said chief executive A.G. Lafley.
“Top-line results were soft, as expected, given significant foreign exchange impacts, our deliberate choices to exit unprofitable businesses and the early stage of the improvement plans we’re implementing in our largest categories and markets.”
P&G revised its fiscal 2016 sales outlook and now expects net sales to be down “high single digits” as compared with the July forecast for a fall of “low-to-mid single digits.”
The shift is due to minor brand divestitures and the impact of a revision in its accounting of the Venezuela business due to a series of foreign exchange policy changes in the South American country.
P&G’s results Friday were for the first quarter of fiscal 2016. The favorable year-over-year comparison was due to the impact of a charge in the year-ago period related to divestitures.
P&G earnings translated into 91 cents per share, or 98 cents when foreign exchange is removed. P&G had been expected to report 95 cents per share.
Revenues came in shy of the $17.17 billion analyst forecast.
P&G shares dropped 0.8 percent in pre-market trade.