On Tuesday, Proctor & Gamble reported earnings that were better than had been expected for its quarter ending in December, as an increase in pricing helped return the giant in consumer products to growth in core sales.
The maker of Bounty paper towels and Pantene shampoo has been struggling for years to ratchet up sales growth and has been underperforming its nimbler, smaller rivals that have grown sales organically across the U.S. as well as abroad.
However, P&G executives predicted sales growth would return for the latest three-month period.
David Taylor, the CEO who took the reins of the consumer products behemoth, said that the company had been encouraged by the improvement in sales and its cost cuts as it is facing significant macroeconomic as well as geopolitical headwinds.
For this year, the company announced it is now expecting foreign exchange to lower its sales by over 7 percentage points, compared to its expectation previously of between 5 and 6 percentage points of headwinds.
It is expecting the foreign exchange will cut its adjusted earnings by as much as 37 cents per share, in comparison to an earlier forecast for a per share impact of 11 cents.
In its fiscal second quarter that ended December 31, Proctor & Gamble said its organic sales, which is a closely observed metric that strips away the currency movements and divestment and acquisitions, increased by 2%.
Higher pricing across every one of its segments helped to offset a decline of 2% in overall volume.
P&G said its volume was pulled down by weakness in certain markets, where the currency has become devalued such as in Brazil, Mexico and Russia.
P&G recorded a volume decline of 3% in its beauty arm, a drop of 1% in grooming and a 3% drop in both its feminine, baby and healthcare and family care areas.
Overall, P&G reported a $3.21 billion profit equal to $1.12 per share which was up from same period one year ago of $2.37 billion equal to 82 cents per share.
Excluding certain items, earnings per share were $1.04.
Revenue dropped by 8.5% to just over $16.92 billion.
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