Procter & Gamble, the maker of Tide detergent and Pampers diapers, reported third-quarter earnings Wednesday that slightly beat Street estimates, but revenue fell short, sending shares of the stock lower in premarket trading.
Here’s what the company reported vs. what the Street was expecting:
- EPS: 96 cents per share adjusted vs. estimate of 94 cents, according to Thomson Reuters analysts’ consensus.
- Revenue: $15.605 billion vs. estimate of $15.731 billion, according to analysts.
Shares were trading down a little more than 1 percent in premarket trade on Wednesday.
Procter & Gamble said its net sales for the quarter fell 1 percent from the prior year, hurt largely by a backdrop of geopolitical challenges and marking the thirteenth consecutive quarter of declines.
“The third quarter macro environment was characterized by a slowdown in market growth, continued geopolitical disruptions and foreign exchange challenges,” CEO David Taylor said in a statement.
Management also cited a slowdown in total market growth as a reason for the company’s 8.3 percent drop in third-quarter profit.
“Market growth really across the world declined … through January and February,” P&G CFO Jon Moeller told CNBC in an interview Wednesday morning. Though, he added, “[Procter & Gamble] remain[s] on track to deliver our going-in objectives on the top line, on the bottom line.”
Organic sales in the company’s grooming segment fell 6 percent — marking the division with the largest decline for the period — due to lower volume and reduced pricing in shave care, Procter & Gamble said.
Organic sales are defined by the company as those that exclude any impacts of foreign exchange and acquisitions and divestitures.
Beauty segment organic sales rose 1 percent from one year ago, while health-care sales increased 6 percent. Gains in the company’s health-care segment were driven by greater volume in oral care, along with innovation on power toothbrushes, P&G explained.
The consumer packaged goods conglomerate also announced Wednesday it’s increasing its forecast for adjusted free-cash-flow productivity in 2017, to 95 percent from 90 percent.
“Challenging environment, frankly a challenging quarter, but [we’re] continuing to make progress,” Moeller told CNBC.
Procter & Gamble added it will maintain its forecast for organic sales growth in the range of two to three percent for the full year 2017.
As of Tuesday’s close, shares of Procter & Gamble have climbed more than 13 percent from one year ago and are up about 7 percent for the year-to-date period.
Source: FactSet