Procter & Gamble Reports Q1 Core EPS Of $1.07; Announces Duracell Exit

(RTTNews) - The Procter & Gamble Company (PG) reported first-quarter net income from continuing operations of $2.00 billion or $0.68 per share compared to $3.04 billion or $1.03 per share, last year. Net earnings per share was $0.69, compared to $1.04. During the quarter the company took a non-cash charge of $932 million after-tax, or $0.32 per share, to adjust the carrying values of goodwill and indefinite-lived intangible assets in its Duracell battery business. The company reported first-quarter core earnings per share from continuing operations of $1.07.

On average, 21 analysts polled by Thomson Reuters expected the company to report profit per share of $1.07 for the quarter. Analysts' estimates typically exclude special items.

Net sales were $20.79 billion, compared to $20.83 billion, a year ago. Analysts expected revenue of $20.83 billion for the quarter. Organic sales grew two percent. Chairman, President, and CEO Lafley, said: "P&G's first quarter results were in-line with our expectations, despite a very difficult operating environment. This keeps us on-track to deliver our fiscal year commitments. We continue to accelerate and increase productivity savings, sharpen our strategies and strengthen our portfolio by focusing on our biggest opportunities."

Procter & Gamble announced its intention to exit the Duracell personal power business by creating a stand-alone Duracell company. The company is exiting the battery business in two steps. The first step was finalizing an agreement to sell its interest in a China-based battery joint venture, which it accomplished in late-August. Terms of this transaction were not disclosed. The second step is the exit of the Duracell business. Although no decision has been made on the form of the exit, P&G's current preference is a split-off of the Duracell business into a stand-alone company.

P&G reiterated its organic sales growth and core earnings per share growth guidance ranges for fiscal year 2015. The company expects significant negative sales and earnings impacts from foreign exchange in the October-December 2014 quarter.

The company continues to expect organic sales growth in the low-to-mid single digit range. Net sales growth is now expected to be in-line to up low single digits versus the prior fiscal year, including a negative two point impact from foreign exchange.

P&G maintained its outlook for core earnings per share growth in the range of mid-single digits. All-in GAAP net earnings per share are now expected to be down two percent to down five percent versus the prior year, including approximately $0.55 per share of non-core charges, primarily from $0.20 per share of non-core restructuring charges and $0.32 of impairment charges.