PROCTER & GAMBLE Q3 INCOME DOWN 16%
- Procter & Gamble Co. said Friday, April 27 its third-quarter net income slipped 16 percent as price increases and an uptick in revenue did not offset high costs for raw material and others related to a restructuring, AP reported.
The world's largest consumer product company also reduced its 2012 guidance due to volume declines in several markets where price increases caused the company to lose market share. Its stock slipped nearly 3 percent in premarket trading.
Consumer product companies across the board have been raising prices to deal with higher costs for materials like pulp, fuel and packaging. The results for P&G, which has an arsenal of products that include Tide detergent and Olay skin cream, illustrate that even big companies that sell trusted brands can lose customers to lower-priced rivals when they raise prices.
P&G said it is rolling back prices in six categories: Powdered laundry detergent in the U.S., Mexico and U.K., as well as North American oral care, dish care and blades and razors. Still, most prices increases have stuck. While the company gained $3.3 billion in revenue through the increases, the rollbacks are worth about $100 million to $200 million, the company said in a call with reporters.
The company said net income fell 16 percent to $2.41 billion, or 82 cents per share during the January to March quarter. That compares with $2.87 billion, or 96 cents per share last year.
Results were impacted by a restructuring plan by P&G that involves cutting 5,700 jobs and saving $10 billion by the end of the fiscal year ending 2016. Excluding costs related to a cost-cutting plan, net income was 94 cents per share, a penny higher than analysts expected according to a FactSet poll. Revenue rose 2 percent to $20.19 billion. Analysts expected $20.35 billion.
One bright spot during the quarter was P&G's North American laundry business. Its new Tide pods single-dose laundry detergent, which P&G estimates has captured 67 percent on the unit-dose market in one month. P&G hopes the pods will eventually account for 30 percent of the U.S. laundry business.
- 1749 Death of Mkhitar Sebastatsee. He founded the Roman Catholic Mkhitarist Congregation. He was born in 1676.
- 1827 Russian forces lay seige to Fort Yerevan (currently the Armenian Winery building).
- 1849 Students create the "Ararat Union" in Paris.
- 1868 Death of Grigor Aghatonyan in Paris. He was born in 1823.
- 1915 Birth of Hovhannes Shiraz (poet). He died in 1984.
- 1919 In Constantinople, start of the trials of the leaders of the Young Turk government and the central committee members of the "Union and Progress" party.
- 1925 The Science and Art Institute of the Armenian SSR opens in Yerevan.
- 1930 Death of Archbishop Eghisheh Doorian, historian, literary figure, author, and Patriarch of Jerusalem.
- 1931 An earthquake (Richter Scale: 6.3) occurs in Zangezoor and affects a 100 000 sq.km. area. The Monastery of Tatev and other structures on the Tatev highlands and in the valley of the Vorotan River are destroyed.
- 1994 Israel officially condemned the Armenian Genocide as Israeli Deputy Foreign Minister Yossi Beilin proclaimed on the floor of the Knesset (the Israeli legislature), in answer to the claims of the Turkish Ambassador, that "It was not war. It was most certainly massacre and genocide, something the world must remember".